The Least Unit Cost Method of Lot-Sizing Technique Adds Ordering

question 32

True/False

The least unit cost method of lot-sizing technique adds ordering and inventory carrying cost for each trial lot size and divides by the number of units in each lot size, picking the lot size with the lowest unit cost.

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Definitions:

Adjusting Entries

Adjusting Entries are journal entries made in accounting records at the end of an accounting period to update accounts for accruals and deferrals not recorded during the period.

Real Account

An accounting record that represents assets, liabilities, and owner’s equity, and is not closed at the end of the accounting period but carried over to the next.

Nominal Account

An account related to income, expenses, losses, or gains—these accounts are closed out to the capital account at the end of an accounting period.

Income Summary

An account to which all income statement account balances are transferred at the end of an accounting period to show the period's profit or loss.