Asked by Corien Frazier on Jun 13, 2024
Verified
When merchandise sold is assumed to be in the order in which the purchases were made, the company is using
A) first-in, last-out
B) last-in, first-out
C) first-in, first-out
D) average cost
Merchandise Sold
Merchandise sold refers to the products that a company sells to its customers, which can include anything from physical goods to software.
Purchases Made
Transactions involving the acquisition of goods or services by a company for the purpose of resale or for use in production.
- Gain insight into the merits and ramifications of choosing different inventory valuation strategies (LIFO, FIFO) within different economic conditions.
Verified Answer
QN
Quyên Nguy?nJun 17, 2024
Final Answer :
C
Explanation :
First-in, first-out assumes that the first items purchased are the first ones sold, which is the most logical way for many businesses to track their inventory. The other options, last-in, first-out and average cost, may be used by some businesses, but they are not assumed to be the order in which items were purchased.
Learning Objectives
- Gain insight into the merits and ramifications of choosing different inventory valuation strategies (LIFO, FIFO) within different economic conditions.
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