Lower-Of-Cost-Or-Net Realizable Value, commonly referred to as LOCORN, is a method of valuing inventory items. It represents the lower of what an item cost or its net realizable value – that is, the price received when it is sold in its normal manner. In other words, if an item costs more than it could be sold for in its current condition, then the lower of cost or net realizable value would represent the worth of the item. This provides businesses with a reliable measure of inventory valuation and helps them to remain profitable and competitive in their industry. The principles of LOCORN are applied in a variety of business contexts ranging from retail to healthcare.