The First-In, First-Out Method Computes Unit Costs by

question 30

Multiple Choice

The first-in, first-out method computes unit costs by

• A)dividing total units by units completed this period.
• B)confining equivalent units to the work completed during the current period only.
• C)the standard-costing method.
• D)separately identifying the conversion costs of beginning and ending inventories.
• E)adding opening inventory units to work-in-process units and dividing by total cost.

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Definitions:

Earn Income

The process of receiving payment through work, investments, or business operations.

Unit Variable

A measurement that reflects how variable costs change per unit of production or activity level.

Unit Fixed

This specifies a cost or charge that remains constant per unit regardless of changes in the level of activity or volume of production.

Costs

Costs refer to the expenditures incurred by a business in the process of generating revenues.