Question: 1. The replacement cost of an inventory item is below the net realizable value less a normal profit margin. The inventory items original cost is

1. The replacement cost of an inventory item is below the net realizable value less a normal profit margin. The inventory item’s original cost is above the net realizable value.

Under the lower of cost or market method, the inventory item should be valued at

a. Original cost.

b. Replacement cost.

c. Net realizable value.

d. Net realizable less normal profit margin.

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