When comparing the rule under any of the methods the purpose of the ceiling is to ensure that the write-down is sufficient to cover all expected gains. the process is consistent with the principle of conservatism because the goal is to limit excessive swings in gross margin. the purpose of the floor is to prevent an excessive gain from being recognized in the future. the appropriate market value is determined before comparing it to the cost. When comparing the rule under any of the methods the purpose of the ceiling is to ensure that the write-down is sufficient to cover all expected gains. the process is consistent with the principle of conservatism because the goal is to limit excessive swings in gross margin. the purpose of the floor is to prevent an excessive gain from being recognized in the future. the appropriate market value is determined before comparing it to the cost