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If a Firm Is Using the Lower-Of-Cost-Or-Market Rule and If

Question 97

Multiple Choice

If a firm is using the lower-of-cost-or-market rule and if a write-down entry is required,which of the following effects will apply?

A) Net income will increase.
B) Gross margin will decrease.
C) Assets will decrease.
D) Ggross margin will decrease and assets will also decrease .

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