Under the first-in, first-out (FIFO)method, the cost of equivalent units of production are calculated by:
A)summing up only the transferred in costs of each department.
B)combining beginning inventory costs with current period costs.
C)considering only the transferred out costs of each department.
D)accounting for beginning inventory costs separately from current period costs.

Question

Quizplus · Accepted Answer

The FIFO method separates the beginning inventory costs from the current period costs. The cost of equivalent units is calculated by adding the beginning inventory costs to the costs incurred during the current period.

Under the First-In, First-Out (FIFO)method, the Cost of Equivalent Units