The use of the lower of cost or market method to value inventory for reporting purposes employs the accounting principle of

A) cost-benefit.
B) matching.
C) historical cost.
D) conservatism.

Conservatism

An accounting principle that requires potential expenses and liabilities to be recognized immediately, while revenues are only recognized when they are assured.

Accounting Principle

A general rule or guideline that guides accounting practices, ensuring consistency, reliability, and transparency in financial reporting.

Cost Or Market

An accounting principle that states inventory should be recorded at either its historical cost or market value, whichever is lower.