Morton Uses the Moving Average Flow Assumption

question 49

Multiple Choice

Morton uses the moving average flow assumption. On January 1, there were 180 units on hand and the total inventory cost was $900. On January 10, 40 more units were purchased at a cost of $6 per unit. Sales included 20 units on January 3 and 60 units on January 17. What was the total cost of goods sold recorded for the units sold on January 17?

• A) $728
• B) $330
• C) $100
• D) $312

---

Definitions:

Risk of Loss

The potential for an asset to decrease in value or for a financial loss to occur in a transaction.

Reimbursed

Repaid or compensated for expenses or losses incurred.

Contract

An agreement legally recognized and enforceable, made between two or more parties.

Specific Language

Precise and clear language that explicitly states or describes something without ambiguity.