When Calculating Unit Costs Under the Weighted-Average Process Costing Method

question 3

Multiple Choice

When calculating unit costs under the weighted-average process costing method, the unit cost is based on:

• A)only the current period's manufacturing costs.
• B)only costs incurred in the period's beginning work-in-process inventory.
• C)a summation of the cost of work in process inventory plus the cost incurred during the current period divided by total equivalent units.
• D)only costs incurred in previous accounting periods.
• E)a summation of the cost of work in process inventory plus the cost to be incurred in the upcoming period divided by total equivalent units.

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Definitions:

Financial Institution

An organization that provides financial services to its clients or members, including banks, credit unions, insurance companies, and investment firms.

Prepayment Penalty Clause

A provision in a mortgage loan contract that requires the borrower to pay a penalty if the mortgage is repaid in full within a certain period.

Lender

An individual or institution that provides funds to another with the expectation that the funds will be repaid, typically with interest.

Mechanic's Lien

A security interest in the title to property for the benefit of those who have supplied labor or materials that improve the property.