Rios, IncUses International Financial Reporting Standards (IFRS)

Multiple Choice

Rios, Inc.uses International Financial Reporting Standards (IFRS) .In 2010, Rios, Inc.experienced a decline in the value of its inventory resulting in a write-down of its inventory from $240,000 to $200,000.The company used the loss method in 2010 to record the necessary adjustment and uses an allowance account to reduce inventory to NRV.In 2011, market conditions have improved dramatically and Rios, Inc.'s inventory increases to an NRV of $216,000.Which of the following will Rios, Inc.record in 2011?

A) A debit to Recovery of Inventory Loss for $16,000.
B) A credit to Recovery of Inventory Loss for $24,000.
C) A debit to Allowance to Reduce Inventory to NRV of $16,000.
D) A credit to Allowance to Reduce Inventory to NRV of $24,000.