Question

Greene Company discloses that its net income for the most recent period was reduced by a writedown of inventory to net realizable value. What effect is the inventory writedown most likely to have on Greene's net income in future periods

Answer 1

Answer:

Increase

Explanation:

The most likely effect that the inventory write down would have on greene's net income n future periods is an increase.

In these future periods, since there is now a lower-valued inventory, this will bring about a lower cost of sales and it would cause net income of the Greene company to become higher.