Generally Accepted Accounting Principles Allow the Cost Flow Pattern for Merchandise

question 41

True/False

Generally accepted accounting principles allow the cost flow pattern for merchandise inventory to differ from the physical flow of merchandise within the business.

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Definitions:

Opportunity Cost

The cost of the next best alternative that must be foregone as a result of making a particular decision.

Limited Resources

A term that describes the finite availability of resources such as time, money, and raw materials, which are necessary for the production of goods and services.

Economics

The social science that studies how individuals, governments, firms, and nations make choices on allocating resources to satisfy their wants and needs, and how these choices interact in markets.

Retail Value

the price at which a product is sold to the end consumer in a retail market.