When Using the Average- Cost Method to Determine the Cost

question 30

Multiple Choice

When using the average- cost method to determine the cost of inventory, the average cost per unit is calculated as the cost of goods:

• A)in ending inventory divided by the number of units in ending inventory.
• B)sold divided by the number of units sold.
• C)sold divided by the average number of units in inventory.
• D)available for sale divided by the number of units available for sale.

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Definitions:

Agency Termination

The process by which the relationship between an agent and their principal is ended.

Violation

The act of breaking or failing to comply with a rule, agreement, or law.

Agency Agreement

A legal contract in which one party (the agent) agrees to act on behalf of another party (the principal) in business transactions or other matters.

Terminate

To bring to an end or to conclude something such as an agreement, employment, or process.