Describe the purpose of lcm rule and accounting convention

Reference no: EM13395381

The lower of cost or market (LCM) rule is used in the valuation of inventories. The LCM rule explains that if the inventory's value decreases below its original cost, the inventory must be written down and a loss must be recognized.

Discuss the purpose of the LCM rule and the accounting convention that supports the rule.

Do you think that this rule has some weaknesses? Please discuss your reasoning.

Reference no: EM13395381

Questions Cloud

At the beginningof the year caples co had total assets of : at the beginningof the year caples co had total assets of 800000 and total liabilities of 300000. if during the year

Cloning has been seen in the news and as a main topic of : cloning has been seen in the news and as a major topic of debate. briefly describe the process of cloning. what might

Write a paper in no more than 1750 words that focuses on : write a paper in no more than 1750 words that focuses on the analysis of different alternatives available to guillermo.

Edelman engineering is considering including two pieces of : edelman engineering is considering including two pieces of equipment truck and an overhead pulley system in this

Describe the purpose of lcm rule and accounting convention : the lower of cost or market lcm rule is used in the valuation of inventories. the lcm rule explains that if the

Gene therapy is a main area of research for curing a : gene therapy is a major area of research for curing a variety of genetic diseases. briefly describe the process of gene

Effective annual rate a financial institution made a 10000 : 1.cash conversion cycle american products is concerned about managing cash efficiently. on the average inventories have

Discoveries in dna cell biology evolution biotechnology : the minimum length for this assignment is 2000 words. discoveries in dna cell biology evolution biotechnology have been

In their own eyes were winklevoss brothers better off in : cameron and tyler winklevoss were classmates of mark zuckerberg at harvard university. they and one other individual

User Account

All Pages