Question

Examples of two alternative assumptions must be made regarding the allocation of the opening inventory to the current accounting period to determine the unit cost for the period

A. FIFO and LIFO.

B. Weighted average and specific identification.

C. FIFO and specific identification.

D. LIFO and weighted average.

Answer 1

The two alternative assumptions for allocating the opening inventory are FIFO and LIFO.

Step-by-step explanation:

The two alternative assumptions that can be made regarding the allocation of the opening inventory to the current accounting period are FIFO (First-In, First-Out) and LIFO (Last-In, First-Out).

FIFO assumes that the items in the inventory that are purchased or produced first are the ones that are sold or used first. LIFO, on the other hand, assumes that the items in the inventory that are purchased or produced last are the ones that are sold or used first.

Other alternatives such as weighted average and specific identification can also be used to determine the unit cost for the period, but they were not listed as options in the given question.