Under the average cost method, the flow of costs through the accounting records will:
A)be nearly the opposite of the physical flow of goods through the business.
B)closely match the physical flow of goods through the business.
C)exactly match the physical flow of goods through the business.
D)have no relationship to the physical flow of goods through the business.

Question

Quizplus · Accepted Answer

The average cost method assigns a cost to inventory items based on the total cost of goods purchased or produced in a period divided by the total number of items purchased or produced, without directly linking the cost flow to the physical flow of goods.

Under the Average Cost Method, the Flow of Costs Through