Which of the Following Is True About Using Forecasts

question 21

Multiple Choice

Which of the following is true about using forecasts?

• A)Multiple forecasts are best, and their predictions can be averaged.
• B)Forecasts become more accurate while predicting further into the future.
• C)Forecasts are useless when the future will look radically different from the past.
• D)The more complex the forecast, the more accurate are the predictions.
• E)The accuracy of forecasts does not vary from one application to another.

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Definitions:

Cost of Goods Sold

The direct financial outlays a company faces for producing the goods it sells, covering both materials and labor.

Perpetual System

An inventory system that records the sale or purchase of inventory immediately through the use of computerized point-of-sale systems and enterprise asset management software.

Replacement Cost

The current cost of replacing an asset with a new one of similar kind and quality.

Ending Inventory

The final valuation of goods available for sale at the conclusion of a reporting period, calculated using beginning inventory plus purchases minus cost of goods sold.