[amp_mcq option1=”LIFO method” option2=”FIFO method” option3=”HIFO method” option4=”Weighted average value method” correct=”option4″]<\/p>\n
The correct answer is: D. Weighted average value method.<\/p>\n
The weighted average value method is a method of inventory valuation that calculates the cost of goods sold by taking the average cost of all the items in inventory. This method is often used when the prices of goods are constantly changing.<\/p>\n
The LIFO method (last in, first out) is a method of inventory valuation that assumes that the items that were most recently purchased are the first ones to be sold. This method is often used when the prices of goods are constantly increasing.<\/p>\n
The FIFO method (first in, first out) is a method of inventory valuation that assumes that the items that were first purchased are the first ones to be sold. This method is often used when the prices of goods are constantly decreasing.<\/p>\n
The HIFO method (highest in, first out) is a method of inventory valuation that assumes that the items that were most expensive to purchase are the first ones to be sold. This method is rarely used because it can result in a significant tax liability.<\/p>\n
In conclusion, the weighted average value method is the only method of valuation that links issuances to current economic prices.<\/p>\n","protected":false},"excerpt":{"rendered":"
[amp_mcq option1=”LIFO method” option2=”FIFO method” option3=”HIFO method” option4=”Weighted average value method” correct=”option4″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[952],"tags":[],"class_list":["post-45984","post","type-post","status-publish","format-standard","hentry","category-costing","no-featured-image-padding"],"yoast_head":"\n