Match the following terms with the appropriate definition.
-A procedure for estimating inventory where the past gross profit rate is used to estimate the cost of goods sold,which is then subtracted from the cost of goods available for sale to determine the estimated ending inventory.
A)Gross profit method
B)Inventory turnover
C)Conservatism principle
D)Consistency concept
E)Consignor
F)Consignee
G)Days' sales in inventory
H)Retail inventory method
I)Specific identification method
J)Lower of cost or market

Question

Quizplus · Accepted Answer

The Gross Profit Method estimates ending inventory by applying the past gross profit rate to current sales, subtracting estimated cost of goods sold from the cost of goods available for sale.

Match the Following Terms with the Appropriate Definition