Asked by Potenza Building Mtrl on May 27, 2024
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The weighted-average method of process costing differs from the first-in, first-out method of process costing in that the weighted-average method:
A) does not consider the degree of completion of beginning work in process inventory when computing equivalent units of production.
B) considers ending work in process inventory to be fully complete.
C) will always yield a higher cost per equivalent unit.
D) All of the choices are correct.
Weighted-Average Method
An inventory costing method that assigns a weighted average cost to each unit of inventory, used to calculate cost of goods sold and ending inventory.
First-In, First-Out
An inventory valuation method where the oldest items in inventory are sold or used first.
Equivalent Units
A concept in cost accounting used to calculate the work done on partially completed goods, expressed in terms of fully completed units.
- Comprehend the distinctions between the weighted-average and FIFO methods within the realm of process costing.
Verified Answer
Learning Objectives
- Comprehend the distinctions between the weighted-average and FIFO methods within the realm of process costing.
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