The Lower-Of-Cost-Or-Market Inventory Method

Multiple Choice

The lower-of-cost-or-market inventory method

A) presents ending inventory on the balance sheet at current replacement cost and Cost of Goods Sold on the income statement at actual cost.
B) is an application of the conservatism principle of accounting.
C) presents Cost of Goods Sold on the income statement at current replacement cost and ending inventory on the balance sheet at actual cost.
D) is a manufacturing company's equivalent to the retail method of inventory.
E) requires that ending inventory be recorded at current replacement cost by increasing Cost of Goods Sold.