Under the Weighted-Average Method for Inventory Costing,the Cost Per Unit

question 116

Multiple Choice

Under the weighted-average method for inventory costing,the cost per unit is determined by ________.

• A) dividing the cost of goods available for sale by the number of units available for sale
• B) dividing the cost of goods available for sale by the number of units in beginning inventory
• C) multiplying the number of units purchased with the weighted-average cost
• D) multiplying the cost of goods available for sale by the ending weighted-average cost of the previous accounting period

Analyze the conditions for least-cost production and resource allocation.

Grasp the implications of different cost industries (increasing, decreasing, and constant-cost industries) on the long-run supply curve.

Identify the characteristics and outcomes of purely competitive markets in long-run equilibrium.

Recognize the role of marginal cost, average total cost, and price in achieving productive and allocative efficiency.

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Definitions:

Payback Period

The amount of time it takes to recover the cost of an investment through its cash inflows.

Payback

The method of calculating the duration required to recover the cost of an investment, emphasizing the time it takes to reach a breakeven point.

Annual Cash Flows

The total amount of money being transferred into and out of a business, affecting its liquidity, over a year.

Required Rate

The minimum return that investors expect to earn from an investment, influencing many financial decisions.