The physical output method is appropriate when products are sold in units of similar size and their net realizable values are similar.

Question

Quizplus · Accepted Answer

The physical output method is suitable for products that are sold in units of similar size and have comparable net realizable values. This method involves tracking the actual physical units produced or sold, rather than assigning costs based on estimates or assumptions. Therefore, it is effective for products that are homogeneous in terms of size and value.

The Physical Output Method Is Appropriate When Products Are Sold