Which of the Following Statements Regarding First-In,first-Out (FIFO)process Costing Is/are

question 32

Multiple Choice

Which of the following statements regarding first-in,first-out (FIFO) process costing is/are true? (A) First-in,first-out (FIFO) process costing transfers out the costs in beginning inventory before transferring out the costs associated with units started and completed.
(B) First-in,first-out process costing requires one additional step in assigning costs to the units transferred out and the ending Work-in-Process Inventory.

• A)A only.
• B)B only.
• C)Both A and B.
• D)Neither A nor B.

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Definitions:

Bad Debt Expense

An expense reported on the income statement, reflecting the cost of credit sales that are not expected to be collected.

Terms 2/10 N/30

A common payment term in business indicating that a buyer can take a 2% discount on the invoice price if payment is made within 10 days; otherwise, the full invoice price is due in 30 days.

Merchandise Returns

Goods returned by the buyer to the seller, often due to defects, dissatisfaction, or other reasons, leading to a reversal of the sale.

Cash Realizable Value

The net amount of cash expected to be received from receivables, after adjusting for any allowances for doubtful accounts.