Under IFRS, inventories are valued at:

A Only historical cost

B Lower of cost and net realizable value

C Market value always

D Replacement cost only

✓ Correct Answer: Option B

IAS 2 requires inventory at the lower of cost and NRV. LIFO is not permitted under IFRS.

💡 Why is B) the correct answer?

The correct answer to the question "Under IFRS, inventories are valued at:" is Option B: Lower of cost and net realizable value.

The other options — A) Only historical cost, C) Market value always, D) Replacement cost only — are incorrect for this CFA Exam Prep question. As explained above: IAS 2 requires inventory at the lower of cost and NRV. LIFO is not permitted under IFRS.

📚 About This CFA Exam Prep Practice Question

This 2-level CFA Exam Prep question from the Financial Reporting & Analysis topic is part of BrainForge Quiz's free exam preparation library. Each question includes the correct answer and a detailed explanation to help you understand the underlying concept, not just memorize the answer.

How to use this page: Read the question above, consider all four options (A through D), then check the highlighted correct answer and explanation. For active timed practice, start a free CFA Exam Prep practice test or use flashcards for spaced repetition review.

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Under IFRS, inventories are valued at:

✓ Correct Answer: Option B

📚 About This CFA Exam Prep Practice Question

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