When the average-cost method is applied to a perpetual inventory system,the sale of goods will not change the unit cost of the goods that remain in inventory.

Question

Quizplus · Accepted Answer

In a perpetual inventory system using the average-cost method, each purchase changes the average cost of the inventory on hand, but the sale of goods does not change the unit cost of the remaining inventory. The unit cost is recalculated after each purchase, not after each sale.

When the Average-Cost Method Is Applied to a Perpetual Inventory