Which Method Will Result in the Same Cost of Goods

question 17

Multiple Choice

Which method will result in the same cost of goods sold amount whether it is computed using the periodic inventory system or the perpetual inventory system?

• A)LIFO
• B)Weighted average cost
• C)FIFO
• D)None of the above because periodic and perpetual inventory systems always produce different amounts.

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Definitions:

Cash Dividends

Payments made by a corporation to its shareholder members. It is the share of profits and retained earnings that the company pays out to its shareholders.

Interest Payment

A payment made to a lender by a borrower in exchange for the use of borrowed money, typically calculated as a percentage of the principal.

Accumulated Depreciation

The cumulative depreciation of an asset up to a single point in its life, reflecting the asset's loss in value due to wear and tear, age, or obsolescence.

Operating Activities

The cash flows related to the core operations of a business, including revenues and expenses.