Select the Incorrect Statement Regarding the Use of Average Unit

question 56

Multiple Choice

Select the incorrect statement regarding the use of average unit costs.

• A) Average costs should be calculated for a sufficiently long time period to capture seasonal fluctuations in costs.
• B) Average costs are often more relevant for decision making than are actual costs.
• C) Average cost information can help managers evaluate performance of the company or departments in the company.
• D) Cost averaging should be used only for fixed costs, and not for variable costs.