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What is the rationale behind the ceiling when applying the lower-of-cost-or-market method to inventory? a) It prevents overstatement of the value of obsolete or damaged

What is the rationale behind the ceiling when applying the lower-of-cost-or-market method to inventory?

a) It prevents overstatement of the value of obsolete or damaged inventories.

b) It allows for items to be valued at replacement cost.

c) It prevents understatement of the inventory value.

d) It allows for a normal profit to be earned.

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