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devry acct304 week 7 discussions




Question;The;lower-of-cost-or-market (LCM) approach was developed to avoid reporting;inventory at an amount greater than the benefits it can provide. The;LCM approach records losses in the period the value of the inventory drops;below its cost instead of later in the period that the goods are ultimately;sold. Is this a conservative or an aggressive approach? What does GAAP say;about LCM?;Q2;Inventory Errors (graded);It is discovered in 2013 that ending inventory from 2011 is understated.;What accounts will be affected by this understatement, and how will they be;affected? This is a situation that really happens. Start with the 2011;inventory being understated, and track the changes through the inventory;account to 2013.;*


Paper#40385 | Written in 18-Jul-2015

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