When comparing the two process costing methods for the same company, equivalent units computed under the first-in, first-out method will always be less than or equal to equivalent units computed under the weighted-average method.

Question

Quizplus · Accepted Answer

Under the FIFO method, only the work done on units in the current period is considered, whereas the weighted-average method averages the work done across both current and prior periods, potentially leading to a higher equivalent unit count.

When Comparing the Two Process Costing Methods for the Same