An assumption about cost flow is necessary
A) because it is required by income tax regulations.
B) only when the flow of goods cannot be determined.
C) because prices usually change,and tracking which units have been sold is difficult.
D) even when there is no change in the purchase price of inventory.

Question

Quizplus · Accepted Answer

An assumption about cost flow is necessary because prices usually change, making it difficult to track which specific units have been sold. This is why methods like FIFO, LIFO, or weighted average are used to estimate cost flows.

An Assumption About Cost Flow Is Necessary