The sum of costs added this period and those in beginning inventory should equal the sum of the costs in ending inventory and the cost of goods transferred out.

Question

Quizplus · Accepted Answer

This statement reflects the basic principle of inventory accounting, where the total available goods (beginning inventory plus purchases or production costs) must equal the goods remaining at the end of the period (ending inventory) plus the goods that were sold or used (cost of goods sold or transferred out).

The Sum of Costs Added This Period and Those in Beginning