Quiz 32: Inventory – Lower of Cost or Market Rule

Test your knowledge of double entry bookkeeping and inventory with our online lower of cost or market rule quiz.

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1. A business presents the following information about a product in its inventory.
Selling price 220.00
Costs to complete 30.00
Normal profit % 60%
Cost 90.00
Replacement cost 75.00
What is the lower or cost or market to be used in the inventory valuation ?
Wrong
Right!
2.A business presents the following information about a product in its inventory.
Selling price 250.00
Costs to complete 40.00
Normal profit 40%
Cost 140.00
Replacement cost 90.00
What is the lower of cost or market to be used in the inventory valuation ?
Right!
Wrong

 

3.A business presents the following information about a product in its inventory.
Selling price 300.00
Costs to complete 60.00
Normal profit 37%
Cost 189.00
Replacement cost 226.00
What is the lower of cost or market to be used in the inventory valuation ?
Right!
Wrong
4. A business presents the following information about a product in its inventory.
Selling price 290.00
Costs to complete 62.00
Normal profit 34%
Cost 191.00
Replacement cost 222.00
What is the lower of cost or market to be used in the inventory valuation ?
Wrong
Right!
5. A business presents the following information about a product in its inventory.
Selling price 280.00
Costs to complete 64.00
Normal profit 31%
Cost 193.00
Replacement cost 213.00
What is the lower of cost or market to be used in the inventory valuation ?
Wrong
Right!
6. A business presents the following information about a product in its inventory.
Selling price 270.00
Costs to complete 66.00
Normal profit 28%
Cost 194.00
Replacement cost 208.00
What is the lower of cost or market to be used in the inventory valuation ?
Right!
Wrong
7. A business presents the following information about a product in its inventory.
Selling price 260.00
Costs to complete 68.00
Normal profit 25%
Cost 190.00
Replacement cost 200.00
What is the lower of cost or market to be used in the inventory valuation ?
Wrong
Right!
8. A business presents the following information about a product in its inventory.
Selling price 250.00
Costs to complete 70.00
Normal profit 22%
Cost 195.00
Replacement cost 195.00
What is the lower of cost or market to be used in the inventory valuation ?
Right!
Wrong
9. A business presents the following information about a product in its inventory.
Selling price 240.00
Costs to complete 72.00
Normal profit 19%
Cost 180.00
Replacement cost 110.00
What is the lower of cost or market to be used in the inventory valuation ?
Right!
Wrong
10. A business presents the following information about a product in its inventory.
Selling price 230.00
Costs to complete 74.00
Normal profit 16%
Cost 193.20
Replacement cost 105.00
What is the lower of cost or market to be used in the inventory valuation ?
Right!
Wrong

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Quiz 32: Inventory – Lower of Cost or Market Rule December 14th, 2016Team

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