average cost inventory costing method generates cost of goods sold and ending inventory amounts that fall between First-in, First-out and Last-in, First-out amounts.

Question

Quizplus · Accepted Answer

The average cost method smooths out price fluctuations by averaging costs, resulting in COGS and ending inventory values that typically fall between FIFO (which uses older costs) and LIFO (which uses more recent costs).

Average Cost Inventory Costing Method Generates Cost of Goods Sold