User:Drew Strotman/sandbox

Critique of article "Lower of cost or market" : It is unclear where the information is coming from. With the exception of reference to the FASB standards update, the other information lacks reference to any source. Article may be over representing the concept of lower of cost and net realizable value. The last section distracts. focus from the subject of the article.Drew Strotman (talk) 22:39, 24 October 2016 (UTC)

Plans for addition to "Lower of cost or market" include addition of multiple sections. The first section would be on the history of the concept and how it was introduced to accounting. Secondly, a section on the problems with the concept would be added, leading into an explanation of why the term has been updated to "lower of cost and net realizable value." Part of each of these sections will be references to academic and trustworthy sources, something the original article lacks. Drew Strotman (talk) 22:54, 24 October 2016 (UTC)

Draft for addition of section about history on lower of cost or market:

History
The concept lower of cost or market became part of normal accounting practices first in England in the nineteenth century. Lower of cost or market was considered fair because assets were valued on a going-concern basis, rather than the price at which the assets were purchased. During the nineteenth century, Lower of cost or market was not common practice for valuation of factory inventory in the United States. The concept did was not easy for the Academic Accountants to accept due to its lack of logic.Despite the criticism, lower of cost or market quickly caught on and by the early twentieth century was described as the most commonly accepted method for inventory valuation according to the Report of the Special Committee on Co-operation with Stock Exchanges Although it lacked accounting logic, lower of cost or market survived because of its conservative approach to valuation and because it addressed opposing principles of cost and value. Its conservatism allowed users to value the inventory at the price for which the inventory could be sold.