1. Historical Costs and Inventory Decisions
Explain why it is sometimes best to sell inventory for less than the amount paid for it.
There are a number of reasons why a company might sell inventory at less than cost:
1. They need some quick cash for a loan coming due or payment of taxes, or another unrelated issue
2. The inventory might be decreasing in value because of obsolescence, perishable concerns, or fad changes in the market
3. The inventory might be very high end, ...
The solution provides a listing of 10 reasons why a company might decide to sell inventory at less than cost. Each reason is explained in the context of possible effects or consequences of the decision.