_________________ Uses the Sales Price as a Basis of Calculating

question 2

Multiple Choice

_________________ uses the sales price as a basis of calculating the markup percentage.

• A) Cost plus pricing
• B) Price war
• C) Markup on sales price
• D) Average-cost pricing
• E) Target return pricing

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Definitions:

Work in Process

Inventory category referring to goods that are in the process of being manufactured but are not yet completed.

Process Costing

Process costing is a method of assigning production costs to units of output in industries where the products are indistinguishable from each other and produced in a continuous process.

Weighted-Average Method

An inventory costing method that assigns an average cost to each unit of inventory, factoring in both the cost and quantity of goods available.

Material Cost

The total expense incurred to acquire materials used in the making of a product, including direct and indirect materials.