Which of the Following Is an Assumption Under FIFO Process-Costing

question 119

Multiple Choice

Which of the following is an assumption under FIFO process-costing method?

• A) It assumes some of the higher-cost units are placed in ending work in process.
• B) It assumes that all the lower-cost units from the previous period in beginning work in process are the first to be completed and transferred out of the process.
• C) It assumes that unit inputs costs are constant and do not fluctuate in the short run.
• D) It assumes that the ending work in process consists of only the lower-cost current-period units.

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Definitions:

Six-Month

A period or duration of six calendar months.

Interest Payment

The cash paid by a borrower to a lender for the privilege of borrowing money, typically based on the interest rate of the loan or debt.

Other Income

A financial term referring to income generated from activities not directly related to the entity's primary business operations.

Other Expense

Expenses that do not fit into the usual categories of operating expenses in a business, such as lawsuit settlements or loss on asset disposal.