Which of the Following Is Not a Physical Measure That

question 63

Multiple Choice

Which of the following is not a physical measure that can be used for allocating joint costs using the physical quantities method?

• A) Tons of steel.
• B) Ounces of gold.
• C) Dollars of labor.
• D) Feet of lumber.

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Definitions:

Conversion Cost

The combination of labor and manufacturing overhead costs required to convert raw materials into finished goods.

Conversion Costs

The combined costs of direct labor and manufacturing overhead, which are incurred to convert raw materials into finished goods.

FIFO Method

"First In, First Out," an inventory valuation method where goods first purchased or produced are sold first, affecting inventory cost and profits.

Process Costing

An accounting method used where costs are accumulated for a continuous process and then assigned to individual units of output.