The Machine Has Just Been fiLled with 50 Black, 150

question 116

Multiple Choice

The machine has just been filled with 50 black, 150 white, 100 red and 100 yellow gum balls that
Have been thoroughly mixed. Sue and Jim approached the machine first. They both said they
Wanted red gum balls. What is the likelihood they will get their wish?

• A) 0.50
• B) 0.062
• C) 0.33
• D) 0.75

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Definitions:

First-In, First-Out Method

An inventory valuation method where the costs of the earliest goods purchased are the first to be recognized in determining cost of goods sold.

Equivalent Unit

A concept used in cost accounting to represent the portion of a product, in terms of material, labor, or overhead costs, completed within a given period, facilitating cost analysis.

Assembly Department

A division within a manufacturing facility where components are assembled into final products or where significant assembly activity takes place.

First-In, First-Out Method

An inventory valuation method where the goods first produced or acquired are sold or used before newer inventory.