The Specific Identification Formula of Costing Inventories Is Used When

question 22

Multiple Choice

The specific identification formula of costing inventories is used when the

• A) physical flow of units cannot be determined.
• B) company sells large quantities of relatively homogeneous items.
• C) company has sophisticated technology to account for its inventory.
• D) company sells a small number of expensive, easily distinguishable items.

---

Definitions:

Budget Constraint

The limitations on the spending decisions of consumers based on their income and the prices of goods and services.

Demand Curve

A graphical representation showing the relationship between the price of a good or service and the quantity demanded by consumers.

Perfectly Inelastic

Perfectly inelastic describes a market scenario where the quantity demanded or supplied does not change regardless of price fluctuations.

Supply

The total amount of a certain good or service that is available for purchase at a particular price level and time.