Average Inventory Level at the End of Each Period Is

question 87

Multiple Choice

Average inventory level at the end of each period is given by ______.

• A)Average inventory = (Beginning inventory + Ending inventory)/ 2
• B)Average inventory = (Beginning inventory + Ending inventory)* 2
• C)Average inventory = (Beginning inventory - Ending inventory)/ 2
• D)Average inventory = (Beginning inventory - Ending inventory)* 2

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Definitions:

Equity Method

An accounting technique used to record an investor's proportional share of an associate company's net income or loss on its financial statements.

Purchase Price

The total cost that is paid to acquire an asset or service, often including additional fees and taxes beyond the sticker price.

Equity Method

An accounting technique used to record investments where the investor has significant influence but does not control the investee.

Net Income

The remaining earnings of a company after subtracting total expenses and taxes from its gross revenue.