- This topic has 1 reply, 2 voices, and was last updated 2 years ago by .
Viewing 2 posts - 1 through 2 (of 2 total)
Viewing 2 posts - 1 through 2 (of 2 total)
- You must be logged in to reply to this topic.
OpenTuition recommends the new interactive BPP books for September 2024 exams. Get your discount code >>
Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FA – FIA FFA › Inventory valuation
If an entity uses the continuous weighted average cost method to value closing inventory,
Which of the following statements is true?
A Unit average cost is recalculated each time there is a purchase of inventory
B Unit average cost is calculated once only at the end of an accounting period
C Unit average cost is recalculated each time there is a sale of goods
D Unit average cost is recalculated each time there is a purchase or a sale
kit says the answer is A.
But I think the answer is C. We calculate cost per unit in continuous weighted average, each time there is a sale of goods
please correct me sir, if I’m wrong
The answer is indeed A.
The cost is recalculated every time there is a new purchase. It is only when there is new purchase that the cost is going to be different.
Have you watched my free lectures on this?