When Using the Moving-Average Cost Formula with a Perpetual System

question 42

Multiple Choice

When using the moving-average cost formula with a perpetual system,

• A) a weighted-average cost is calculated at year end.
• B) a new unit cost is calculated each time a sale is made.
• C) a new unit cost is calculated each time a purchase is made.
• D) a new unit cost is calculated both when a sale is made and when a purchase is made.

---

Definitions:

Measurement Validity

The extent to which a tool, test, or instrument accurately measures what it is intended to measure.

Freudian Psychoanalysis

A theoretical approach in psychology that emphasizes unconscious motivations and conflicts as the basis of human behavior, developed by Sigmund Freud.

Humanism

A philosophical and ethical stance that emphasizes the value and agency of human beings, individually and collectively, and generally prefers critical thinking and evidence over dogma or superstition.

Trait Theory

A psychological perspective that postulates that individual personalities are composed of broad dispositions, known as traits, which can predict behavior.