Match the Terms with the Definitions

question 39

Multiple Choice

Match the terms with the definitions.
-Under this system, the ending inventory and cost of goods sold are determined at the end of the accounting period, when a physical inventory is taken.

• A)average cost
• B)weighted-average method
• C)consignee
• D)consigned goods
• E)specific identification method
• F)retail method
• G)cost
• H)physical inventory
• I)periodic inventory system
• J)in transit
• K)inventory sheet
• L)natural business year
• M)lower-of-cost-or-market method

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Definitions:

Weighted-Average Method

An inventory valuation method that calculates the cost of goods sold and ending inventory based on the average cost of all goods available for sale during the period.

Equivalent Units

A concept in cost accounting used to equate units partially completed at the end of a period to units of finished goods.

Materials Cost

The total expense incurred by a company to purchase raw materials used in the production of goods or services.

Process Costing

A costing method used for homogeneous products, where costs are accumulated over a period and assigned to large numbers of identical units.