cost-or-market method

简明释义

原价与市价按低价盘存法

英英释义

例句

1.Investors should pay attention to how companies apply the cost-or-market method when analyzing their financial health.

投资者在分析公司的财务健康时，应关注公司如何应用成本或市价法。

2.The company decided to use the cost-or-market method to value its inventory, ensuring they report the lower of cost or market value.

公司决定使用成本或市价法来评估其库存，以确保报告的价值为成本或市价中的较低者。

3.Using the cost-or-market method allows businesses to present a more accurate financial position in their statements.

使用成本或市价法可以让企业在财务报表中呈现更准确的财务状况。

4.The cost-or-market method can lead to significant fluctuations in reported profit depending on market conditions.

根据市场条件，成本或市价法可能导致报告利润的显著波动。

5.Under the cost-or-market method, if the market value of an asset decreases significantly, it must be written down to reflect this change.

根据成本或市价法，如果资产的市场价值显著下降，则必须进行减记以反映这一变化。

作文

The cost-or-market method is a fundamental approach used in accounting to value inventory. This method allows businesses to report their inventory at either its historical cost or its market value, whichever is lower. The rationale behind this approach is to ensure that the financial statements reflect a conservative estimate of the asset's value, thereby preventing overstatement of assets and ensuring that stakeholders have a clear and accurate picture of the company's financial health.To understand the cost-or-market method, it is essential to grasp the concepts of cost and market value. Cost refers to the amount spent to acquire an inventory item, including all expenses related to bringing the item to its current condition and location. On the other hand, market value is determined by the current replacement cost of the inventory item, which may fluctuate based on market conditions.For example, consider a company that has purchased a batch of goods for $10,000. Due to changes in market demand, the current market value of these goods has dropped to $8,000. According to the cost-or-market method, the company would report the inventory at $8,000, reflecting the lower market value rather than the historical cost. This conservative approach helps investors and creditors make informed decisions based on realistic values.One significant advantage of the cost-or-market method is that it aligns with the principle of conservatism in accounting. By valuing inventory at the lower of cost or market, companies avoid inflating their asset values, which could mislead stakeholders about the company's performance and financial stability. This method also mitigates the risk of recognizing unrealized gains, as it does not allow for potential profits until they are realized through sales.However, the cost-or-market method is not without its challenges. Determining the market value can be subjective and may require management judgment. Additionally, fluctuations in market prices can lead to volatility in reported earnings, which may concern investors looking for stable and predictable financial results. Companies must also ensure they consistently apply this method to maintain comparability across reporting periods.In conclusion, the cost-or-market method serves as a crucial tool in inventory valuation, promoting transparency and conservatism in financial reporting. By allowing for the reporting of inventory at the lower of cost or market value, this method helps safeguard against overvaluation and provides stakeholders with a more accurate reflection of a company's financial position. As businesses navigate the complexities of inventory management and market dynamics, understanding and applying the cost-or-market method becomes essential for sound financial practices and decision-making.

“成本或市场法”是会计中用于评估库存的基本方法。这种方法允许企业以历史成本或市场价值中的较低者来报告其库存。该方法背后的理由是确保财务报表反映出资产价值的保守估计，从而防止资产的高估，并确保利益相关者对公司的财务健康状况有清晰准确的了解。要理解“成本或市场法”，首先必须掌握成本和市场价值的概念。成本是指购买库存项目所花费的金额，包括与将项目带到当前状态和位置相关的所有费用。另一方面，市场价值是根据库存项目的当前替代成本来确定的，这可能会根据市场条件波动。例如，考虑一家购买了一批商品，花费为10,000美元。由于市场需求变化，这些商品的当前市场价值降至8,000美元。根据“成本或市场法”，公司将以8,000美元报告库存，反映出较低的市场价值，而不是历史成本。这种保守的方法有助于投资者和债权人根据现实价值做出明智的决策。“成本或市场法”的一个显著优点是它与会计中的保守原则一致。通过以成本或市场中较低者的方式评估库存，公司避免了夸大资产价值，这可能会误导利益相关者关于公司业绩和财务稳定性的看法。这种方法还降低了确认未实现收益的风险，因为它不允许在销售之前确认潜在利润。然而，“成本或市场法”并非没有挑战。确定市场价值可能是主观的，并可能需要管理层的判断。此外，市场价格的波动可能导致报告收益的波动，这可能会让寻求稳定和可预测财务结果的投资者感到担忧。公司还必须确保始终如一地应用该方法，以保持报告期间之间的可比性。总之，“成本或市场法”作为库存评估的重要工具，促进了财务报告的透明度和保守性。通过允许以成本或市场价值中的较低者报告库存，这种方法有助于防止高估，并为利益相关者提供公司财务状况的更准确反映。在企业应对库存管理和市场动态的复杂性时，理解和应用“成本或市场法”对于健全的财务实践和决策至关重要。