Fundamentals of Cost Accounting 3rd Edition by William N. Lanen, Shannon W. Anderson, Michael Maher

Exercise 13

In computing the cost per equivalent unit, the weighted-average method considers

a.Current costs only.

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b.Current costs plus costs in beginning WIP inventory.

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c.Current costs plus the cost of ending WIP inventory.

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d.Current costs less costs in beginning WIP inventory.

Step 1 of 5

The weighted average method does not consider the production completed in earlier period and considers the entire production to be produced in the current period. The weighted average method allocates cost to goods on average of the costs and hence, costs incurred in earlier period also form a part of the calculation of cost of goods produced or completed in the current period.