An Assumption About Cost Flow Is Necessary

question 139

Multiple Choice

An assumption about cost flow is necessary

• A) because it is required by the income tax regulation.
• B) even when there is no change in the purchase price on inventory.
• C) only when the flow of goods cannot be determined.
• D) because prices usually change, and tracking which units have been sold is difficult.

---

Definitions:

Frequent Reporting

The practice of regularly submitting business performance reports more often than the standard annual reporting.

Dissolution

The process of legally dissolving a corporation or partnership, resulting in the termination of its business operations.

Safe Payments

Payments that are secure and protected against fraud or theft, often through encryption and authentication measures.

Capital Deficit Balances

Situations where a company's total capital is less than zero, indicating that its liabilities exceed its assets.