What will happen when the cost$-$of$-$goods$-$sold method is used to record inventory at NRV$?$

Select answer from the options below

There is a direct reduction in product selling price results in a loss being recorded on the income statement prior to the sale.

The ending inventory market value figure is substituted for cost and the loss is included in cost of goods sold.

The only portion of the loss attributable to inventory sold during the period is recorded in the financial statements.

A loss is recorded directly in the inventory account by crediting inventory and debiting loss on inventory decline.