Accounting Dictionary - Letter L

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Lower of cost or market
(also called LCM) rule states that if the market value of ending inventory is lower than the book value of such inventory, the resultant loss must be recognized in the current period. The lower of cost or market rule can be applied to valuing inventory on item-by-item, category, or total basis.
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