The Weighted-Average Cost Inventory Cost Flow Method Can Be Described

question 60

Multiple Choice

The weighted-average cost inventory cost flow method can be described by all of the following except:

• A) Is generally used with a perpetual inventory system.
• B) Is not subject to income manipulation.
• C) Assigns the same unit cost to cost of goods sold and to ending inventory.
• D) Involves assignment of the total cost of goods available for sale to cost of goods sold and ending inventory only at the end of the period.

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Definitions:

Sales Volume

The total number of units or products sold within a specific period.

Fixed Expense

Overheads that stay the same, no matter how much is produced or sold, encompassing charges such as property rent, staff paychecks, and insurance coverage costs.

Break-Even

Break-even refers to the point at which total costs and total revenues are exactly equal, resulting in neither profit nor loss.

Variable Expense

Costs that vary directly with the level of production or sales volume, such as raw materials and direct labor costs.