How does the application of the lower-of-cost-or-market rule differ between U.S. GAAP and IFRS?
Both U.S. GAAP and IFRS require use of the lower-of-cost-or-market rule to value inventories. However, the two sets of standards differ in two respects. First, U.S. GAAP defines market value as replacement cost, subject to a maximum and minimum amount. In contrast, IFRS uses net realizable value as the measure of the market value of inventory, and no upper or lower limits are imposed. Second, under U.S. GAAP, if inventory is written down to a new, lower market value, this amount becomes the basis for that inventory. Future write-downs of the inventory use this new amount to compare with market value. However, under IFRS, write-downs of inventory can be reversed in later periods. That is, a gain is recognized when the value of the inventory goes back up.
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The purchasing manager was able to bring down the cost of direct materials by purchasing direct materials of a slightly lower grade quality than the company had used previously. The lower grade of direct materials, however, meant a higher defect rate on the assembly line and a higher waste of direct materials during production, which in turn lowered operating income. This situation would lead to a(n) ________.
A) favorable direct materials cost variance B) unfavorable direct labor cost variance C) favorable direct labor efficiency variance D) favorable direct materials efficiency variance
The _____________________________ occurred when railroad workers across the country went out on strike to protest wage cuts, large crowds took over depots and roundhouses, and rioting caused significant damage to railroad property.
Fill in the blank(s) with the appropriate word(s).
All but one of the following are alphabetic indexing methods
A. Geographical B. Name C. Chronological D. Subject
To improve the effectiveness of the HR function, activities that can be handled through computerization are ______.
a. traditional b. transactional c. transformational d. all of these