Many Companies Assign Only the Net Invoice Price for Merchandise

question 94

Multiple Choice

Many companies assign only the net invoice price for merchandise to inventory and cost of goods sold.All other costs, including transportation and other costs of bringing merchandise to the place of business, are charged to expense of the period in which they are incurred.Which accounting principle or concept is applied in this example?

• A) Historical cost
• B) Conservatism
• C) Matching
• D) Cost/Benefit

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