Financial Measures Such as Return on Investment (ROI) and Residual

question 8

True/False

Financial measures such as return on investment (ROI) and residual income as well as operating measures may be included in a balanced scorecard.

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Definitions:

Weighted-Average Method

An inventory costing method that calculates the cost of goods sold and ending inventory based on the average cost of all units available for sale during the period.

Assembly Department

The section of a manufacturing plant where components are put together to form a finished product.

Conversion Costs

Costs related to turning raw materials into finished goods, typically including direct labor and manufacturing overhead.

Weighted-Average Method

A method of inventory costing or process costing that averages the costs of all goods available for sale or production, assigning an average cost to each unit.