In which of these inventory approaches is it important to determine the actual cost of a particular inventory item being sold in order to determine cost of goods sold?
A)LIFO.
B)FIFO.
C)Specific identification.
D)Weighted average cost.

Question

Quizplus · Accepted Answer

Specific identification is the inventory approach that requires determining the actual cost of a particular inventory item being sold in order to determine cost of goods sold. This method assigns a specific cost to each item sold, allowing for precise calculation of cost of goods sold. LIFO, FIFO, and weighted average cost methods do not require the actual cost of a particular inventory item to be determined in order to determine cost of goods sold.

In Which of These Inventory Approaches Is It Important to Determine