The Fact That _____ Is Not a Disadvantage of Transferring

question 170

Multiple Choice

The fact that _____ is not a disadvantage of transferring items at cost.

• A)transferring items at cost can disguise a cost's behavior pattern
• B)the buying segment will not be able to plan its costs
• C)cost inefficiencies are passed along to the buying department
• D)it cannot be used to evaluate segment performance

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Definitions:

LIFO Perpetual

A perpetual inventory system method that assumes the last items added to inventory are the first ones sold, under the Last-In, First-Out principle.

Inventory Value

The total cost of all the items held by a company for resale or production purposes, calculated at a specific point in time.

Cost of $200

A set expense value amounting to two hundred dollars.

Periodic LIFO

An inventory valuation method that uses the Last In, First Out principle during a set period, assuming the most recently acquired items are sold first.