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When following U.S. GAAP, which of the following statements is not correct regarding the LCM rule for inventory? The individual-item approach to LCM is the
When following U.S. GAAP, which of the following statements is not correct regarding the LCM rule for inventory?
The individual-item approach to LCM is the most conservative because it results in the largest write-down. | ||
U.S. GAAP specifies a preference for using the individual-item approach. | ||
Firms can apply the LCM rule for inventory to the aggregate inventory, product lines, or individual items in inventory. | ||
U.S. GAAP does not specify a preference for the different methods of applying the lower-of-cost-or-market rule. |
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