Which of the Following Statements Is False Regarding an Assumption

question 164

Multiple Choice

Which of the following statements is false regarding an assumption of inventory cost flow?

• A) The cost flow assumption need not correspond to the actual physical flow of goods.
• B) The assumption selected may be changed each accounting period.
• C) The FIFO assumption uses the earliest acquired prices to cost the items sold during a period.
• D) The LIFO assumption uses the earliest acquired prices to cost the items on hand at the end of an accounting period.

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Definitions:

Extended Lunch Breaks

Longer than normal break periods allocated for lunch, beyond the typical schedule.

Co-Workers

Individuals who work together, often sharing tasks or goals within the same organization.

Economies Of Scale

The cost advantages that enterprises obtain due to their scale of operation, leading to decreased costs per unit.

Network Effects

The phenomenon where the value or utility of a product or service increases as more people use it, often seen in digital and social media platforms.