Which inventory costing method assigns the same cost to all units whether sold or left in ending inventory?
A)Specific identification
B)Weighted average cost
C)FIFO
D)LIFO

Question

Quizplus · Accepted Answer

The inventory costing method that assigns the same cost to all units, whether sold or left in ending inventory, is known as the weighted average cost method. This method calculates the average cost of all units available for sale during a given period, including the beginning inventory and purchases made during the period. The resulting average cost is then applied to both units sold and those left in ending inventory. This method is widely used because it smoothes out fluctuations in the cost of inventory due to fluctuations in purchase prices. Therefore, the best choice is option B.

Which Inventory Costing Method Assigns the Same Cost to All