Which of the following is a reason why the specific identification method may be considered ideal for assigning costs to inventory and cost of goods sold?
A) The potential for manipulation of net income is reduced.
B) There is no arbitrary allocation of costs.
C) The cost flow matches the physical flow.
D) Able to use on all types of inventory.

Question

Quizplus · Accepted Answer

The specific identification method is ideal because it matches the cost flow with the physical flow of inventory, reducing the potential for arbitrary allocation of costs. However, it may not be practical or feasible for all types of inventory, such as those that are indistinguishable from each other. The other options do not accurately describe the advantages of the specific identification method.

Which of the Following Is a Reason Why the Specific