Any business that sells numerous units of identical products may determine its cost of goods sold using a cost flow assumption,rather than the specific identification method.

Question

Quizplus · Accepted Answer

This is true. Cost flow assumptions, such as FIFO, LIFO, or weighted-average, are commonly used for inventory management and cost of goods sold calculations in businesses that sell numerous units of identical products. This method is more practical and efficient than the specific identification method, which involves tracking the cost of each individual item sold.

Any Business That Sells Numerous Units of Identical Products May