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Under the lower-of-cost-or-market basis in valuing inventory, cost is defined as selling price less cost of...

Under the lower-of-cost-or-market basis in valuing inventory, cost is defined as

selling price less cost of disposal.
selling price.
historical cost plus 10%.
selling price less markup.
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Answer #1

Under the lower of cost or market basis in valuing inventory, cost is defined as selling price less cost of disposal.

The lower of cost or market rule states that a business must record the cost of inventory at whichever cost is lower- the original cost or its current market price.

Cost plus pricing is a cost-based method for setting the prices of goods or services. Under this approach, direct material cost, direct labor cost, overhead costs for a product, and add to it a markup percentage.

Markup is the percentage difference between a product's cost and its selling price.

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