Asked by
Bryan Torres
on Oct 28, 2024
Verified
Which one of the following is not a disadvantage of the specific identification method of inventory costing?
A) It allows manipulation of profits.
B) It does not match expenses against revenues.
C) It is too expensive to use in complex manufacturing situations.
D) It is only practical where units are costly and easily distinguishable.
Specific Identification Method
An inventory valuation method that tracks the cost of specific items sold and remaining inventory.
Manipulation Of Profits
The unethical or illegal adjustment of a company's financial records in order to present an inaccurately positive picture of its financial performance.
Expenses Against Revenues
The matching principle in accounting that involves recording expenses in the period in which they helped to generate revenues.
- Assess the cost implications for inventory by making use of different notions of inventory cost flow, for instance, FIFO, LIFO, and the weighted average calculation.
- Understand how different approaches to managing inventory affect financial disclosures and tax responsibilities.
Verified Answer
KP
Learning Objectives
- Assess the cost implications for inventory by making use of different notions of inventory cost flow, for instance, FIFO, LIFO, and the weighted average calculation.
- Understand how different approaches to managing inventory affect financial disclosures and tax responsibilities.