Answer fo Chapter7 Receivables.docVIP

CHAPTER 7 Receivables KEY TERM average cost method The method of inventory costing that is based upon the assumption that costs should be charged against revenue by using the weighted average unit cost of the items sold. first-in, first-out (FIFO) method The method of inventory costing based on the assumption that the costs of merchandise sold should be charged against revenue in the order in which the costs were incurred. gross profit method A method of estimating inventory cost that is based on the relationship of gross profit to sales. inventory turnover The relationship between