FIFO,LIFO,and Weighted Average Inventory Costing Methods Are Based On

question 29

Multiple Choice

FIFO,LIFO,and weighted average inventory costing methods are based on:

• A)assumptions that accountants make about the flow of inventory costs.
• B)the actual physical flow of goods purchased and sold by a business.
• C)surveys taken that ask real companies how they value their inventories.
• D)the accounting equation (assets = liabilities + stockholders' equity).

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Definitions:

Average Tax Rate

The fraction of total income that is paid in taxes, calculated by dividing the total amount of taxes paid by the total income.

Incentive To Work

Factors, such as financial rewards or benefits, that motivate individuals to engage in employment.

Social Security Tax

A tax imposed by the government to fund the Social Security program, which provides retirement, disability, and survivorship benefits.

Personal Income Tax

A tax levied on individuals or households based on their income, including wages, dividends, and interest.