Exam MB-310 topic 1 question 82 discussion

DRAG DROP -
You are implementing Dynamics 365 Finance.
You must associate items with an item model group. An inventory close must not be required.
You need to configure the item model group.
Which costing method should you use? To answer, drag the appropriate costing method to the correct system behavior. Each costing method may be used once, more than once, or not at all. You may need to drag the split bar between panes or scroll to view content.
NOTE: Each correct selection is worth one point.
Select and Place:

Suggested Answer:
Box 1: Standard cost -
Standard costs are estimates of the cost of goods sold -- that is, the cost required to produce your products. They usually consist of three parts: direct materials, direct labor, and manufacturing overhead.

Box 2: Moving average -
Moving average is a perpetual costing method based on the average principle, where the costs on inventory issues do not change when the purchase cost does.
Incorrect:
* Weighted average is an inventory model based on an average that results from the multiplication of each component (item transaction) by a factor (cost price) reflecting its importance (quantity). Another way to say this is that weighted average is an inventory model that assigns the cost of issue transactions based on the mean value of all inventory received during the period, plus any on-hand inventory from the previous period.
* First in, First out (FIFO) is an inventory model in which the first acquired receipts are issued first. Financially updated issues from inventory are settled against the first financially updated receipts into inventory, based on the financial date of the inventory transaction.
Reference:
https://www.fool.com/the-ascent/small-business/accounting/articles/standard-cost/ https://docs.microsoft.com/en-us/dynamics365/supply-chain/cost-management/moving-average