Alice Was Recently Criticized for the Poor Performance of Her

question 26

Multiple Choice

Alice was recently criticized for the poor performance of her store this quarter. When Alice stated that profits for the company overall were down for the quarter, she mentioned that recent highway construction in front of her store was the main reason for low profits. She presented reports that compared store sales along the highway versus other stores in her town to prove her point. This is an example of

• A) inoculation.
• B) inductive reasoning.
• C) deductive reasoning.
• D) cognitive dissonance.

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Definitions:

Ending Inventory

The overall worth of items ready for sale after an accounting period, determined by starting inventory added to purchases and then subtracting the cost of goods sold.

Periodic Inventory System

An inventory accounting system where updates to the quantity and cost of inventory are made at specified intervals, such as monthly or yearly, not continuously.

FIFO Method

FIFO method, or First-In, First-Out, is an inventory costing method where the first items placed into inventory are the first ones sold, used for calculating cost of goods sold and ending inventory.

Cost of Goods Sold

Cost of goods sold is the direct costs attributable to the production of the goods sold by a company, including the cost of materials and labor.