alleryStart learning →At what value should damaged or obsolete goods be recorded?
AOriginal purchase cost
BRetail selling price
CReplacement cost value
DNet realizable value
Answer & Solution
Correct answer: D. Net realizable value
Goods that can only fetch less than purchase price are written down to what they can realistically yield after disposal costs.
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Related questions
The ABC concept is based on whose law?An item needs 500 units a year at Rs 40 each. What is its annual usage value?After computing usage values, items are arranged in which order?In ABC analysis, how is an item's annual usage value computed?ABC class thresholds are what?Class B holds 30% of items. About what share of annual consumption value does it hold?Half of all items fall in class C. Roughly what share of consumption value do they hold?ABC analysis resembles which principle, where few items carry most value?