Which One of the Following Sets of Inventory Cost Flow

question 54

Multiple Choice

Which one of the following sets of inventory cost flow assumptions is not susceptible to profit manipulation by management?

• A)FIFO and specific identification
• B)LIFO and average cost
• C)FIFO and average cost
• D)LIFO and specific identification

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Definitions:

Equilibrium Price

The price at which the quantity of a good demanded by consumers equals the quantity supplied by producers, resulting in a stable market condition.

Price Floor

A government- or authority-imposed minimum price that can be charged for a product or service, often above the equilibrium price.

Network Externality

A situation where the value of a product or service increases as more people use it.

Intrinsic Value

The inherent or fundamental worth of something, not influenced by external factors or market conditions.