QQuestionAccounting
QuestionAccounting
The selected inventory costing method, such as FIFO, LIFO, or Weighted Average, impacts:
A. The physical flow of goods.
B. The shipping terms to the buyer.
C. Gross profit and net income.
D. The quantity of inventory items on hand.
E. Sales.
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Answer
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Step 1Let's solve this accounting inventory costing method problem step by step:
Step 2: Understand the Inventory Costing Methods
Inventory costing methods are accounting techniques used to assign costs to inventory and cost of goods sold. The primary methods are: - FIFO (First-In, First-Out) - LIFO (Last-In, First-Out) - Weighted Average Cost Method
Final Answer
Gross profit and net income is the correct choice, as inventory costing methods directly influence how costs are allocated and thus impact financial statement calculations.
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