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At the end of the 2012 accounting period Vellenga Company determined that the market value of its inventory was $25,400. The historical cost of this inventory was $28,600. Vellenga uses the perpetual inventory method. The entry necessary to reduce the inventory to the lower of cost or market will act to increase assets and increase net income. True or False True False

At the end of the 2012 accounting period Vellenga Company determined that the market value of its inventory was $25,400. The historical cost of this inventory was $28,600. Vellenga uses the perpetual inventory method. The entry necessary to reduce the inventory to the lower of cost or market will act to increase assets and increase net income. True or False True False

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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At the end of the 2012 accounting period Vellenga Company determined that the market value of its inventory was $25,400. The historical cost of this inventory was $28,600. Vellenga uses the perpetual inventory method. The entry necessary to reduce the inventory to the lower of cost or market will act to increase assets and increase net income. True or False True False
Transcribed Image Text:At the end of the 2012 accounting period Vellenga Company determined that the market value of its inventory was $25,400. The historical cost of this inventory was $28,600. Vellenga uses the perpetual inventory method. The entry necessary to reduce the inventory to the lower of cost or market will act to increase assets and increase net income. True or False True False
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