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Select from the option list provided the inventory cost flow assumption for each explanation below. Each choice may be used once, more than once, or not at all.

Item	Answer
1. Results in the highest cost of goods sold if prices are rising.
2. Unaffected by whether a perpetual or periodic system is used if goods are not specifically identified.
3. Reflects the actual physical flow of goods.
4. Determines cost only at period end but usable in a perpetual system that records only quantities.
5. Ending inventory approximates current replacement cost.
6. Requires an estimate of price-level changes for specific inventories.

Scroll down to complete all parts of this task.

Select from the option list provided the inventory cost flow assumption for each explanation below. Each choice may be used once, more than once, or not at all.

Item Answer

1. Results in the highest cost of goods sold if prices are rising.

2. Unaffected by whether a perpetual or periodic system is used if goods are not specifically identified.

3. Reflects the actual physical flow of goods.

4. Determines cost only at period end but usable in a perpetual system that records only quantities.

5. Ending inventory approximates current replacement cost.

6. Requires an estimate of price-level changes for specific inventories.