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Average method of pricing the material issues is useful when ___________.
Answer & Solution
Correct Answer:
Option
D
Average method of pricing the material issues is useful when material prices are fluctuating. Under the 'Average Cost Method', it is assumed that the cost of inventory is based on the average cost of the goods available for sale during the period. The average cost is computed by dividing the total cost of goods available for sale by the total units available for sale.
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