Following the Consistency Principle, Once a Firm Adopts a Method

question 79

True/False

Following the consistency principle, once a firm adopts a method of inventory valuation, it should use that method consistently from one period to the next.

---

Definitions:

Average Flow Time

The average time that it takes for a task, workpiece, or process to be completed in a system.

Cycle Inventory

The portion of inventory available to meet normal demand during an ordering cycle.

Demand

The quantity of a good or service that consumers are willing and able to purchase at a given price.

Cycle Inventory

The average amount of inventory kept on hand to meet normal demand between the receipt of inventory deliveries.