When Valuing Ending Inventory Under a Perpetual Inventory System, the

question 43

Multiple Choice

When valuing ending inventory under a perpetual inventory system, the

• A) valuation using weighted average is the same as the valuation using weighted average under the periodic inventory system.
• B) weighted average cost method requires that a new weighted average unit cost be calculated after every sale.
• C) valuation using FIFO is the same as the valuation using FIFO under the periodic inventory system.
• D) most recent units purchased during the period using FIFO are allocated to the cost of goods sold when units are sold.

---

Definitions:

Investment Income

Income generated from the allocation of funds into interest-bearing or dividend-yielding assets.

Unallocated Positive

A term that is not widely recognized as standard in accounting or finance; it may refer to surplus income or assets not yet designated for a specific purpose but NO.

Goodwill

An intangible asset that arises when a buyer acquires an existing business, representing the value of the business's reputation, brand, and other unidentifiable assets.

Significant Influence

The power to participate in the financial and operating policy decisions of an investee, but not control them, typically associated with ownership of 20%-50% of voting stock.