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The net realizable value (NRV) of inventories may be lower than their cost in situations where the market price of the inventory has declined due to changes in consumer demand, technological obsolescence, or increased competition. Additionally, if the inventory is damaged, outdated, or excessively overstocked, its sale value can fall below the original cost. This situation necessitates a write-down in the financial statements to reflect the lower value of the inventory, ensuring accurate reporting and compliance with accounting standards.
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What circumstances would allow Country A to have an absolute advantage over Country B in the production of computers?
Companies in Country A can produce computers at a lower cost.
What is one country of comparative advantage in the production of a certain good?
It has a lower opportunity cost for production of that good.
Under what circumstances will opportunity cost be zero?
opportunity cost is said to be zero(0) when resources are in abundance or when there is no cost in ascertaining your want. {ofofra}
Cost of living in 1983 in Australia?
The cost of living in Australia in 1983 was lower than it is today. The electricity and water bills and the cost of buying foods was lower than that which they are experiencing today.
When does Country A have a comparative advantage over Country B in the production of televisions?
Country A has a lower opportunity cost for producing televisions.
The lower of cost or market basis of valuing inventories is an example of?
conservatism
Benefits and cost of holding Inventories?
what is benefits of holding inventories
Regardless of the inventory cost flow assumption used inventories on the balance sheet are stated at a realizable value b the lower of cost or market c original cost d replacement cost?
replacement cost
How does PepsiCo value its inventories?
PepsiCo values its inventories using the lower of cost or net realizable value method, which ensures that inventory is recorded at the lower of its historical cost or the amount expected to be realized from its sale. The cost of inventories typically includes direct costs such as raw materials, labor, and overhead. Additionally, PepsiCo regularly evaluates its inventory for obsolescence and adjusts its valuation accordingly to reflect any necessary write-downs. This approach helps maintain accurate financial statements and supports efficient inventory management.
What inventory method does Walt Disney use?
Carrying amounts of merchandise, materials, and supplies inventories are generally determined on a moving average cost basis and are stated at the lower cost of market.
Why are inventories included in the computation of net income?
To determine cost of goods sold
What circumstances would allow Country A to have an absolute advantage over Country B in the production of computers?
Companies in Country A can produce computers at a lower cost.
lower dentures cost?
lower dentures cost
The specific identification method of costing inventories is used when the?
company sells a limited quantity of high-unit cost items.
Why inventories are assets?
Inventories have a value to any company there value is to make and generate sales profits. The value is recorded as a part of a sale as cost of of goods sold. The are recorded for two main reason to display its value in case of loss (theft, destruction or etc.) and to subtract its value from a sale differentiating from net profits that must be reported for taxation purposes. For this reason companies maintain a close eye on inventories as in inventory reporting estimated taxes are also paid towards it's value - the lower the inventories the less taxes paid. Also, smarter management as inventories may become obsolete in a short time frame of storage - so estimated taxes may be paid at a higher value then obtained in future sales.
Is cost of goods sold an operating expense?
Cost of goods sold is opening stock plus purchases of inventories and other carriage costs less closing stock. Cost of sales therefore is not an operating expense...
what is the cost of upper and lower dentures.?
what is the cost of upper and lower dentures.
