The Consistency Principle Means That One Costing Method, Such as FIFO

question 91

True/False

The consistency principle means that one costing method, such as FIFO or moving weighted average, has to be used exclusively.

---

Definitions:

Common Fixed Expenses

Expenses that remain constant regardless of the level of production or sales activities, such as rent, salaries, and insurance.

Operating Period

The span of time during which a business or a particular machinery is operational or in use.

Net Operating Income

Revenue from the primary business activities of a company, with no deductions for interest and taxes.

Variable Manufacturing Overhead

Variable manufacturing overhead refers to the manufacturing costs that vary with the level of production output, such as utilities and certain labor costs.