A Major Advantage of Using the FIFO Process-Costing Method Is

question 61

Multiple Choice

A major advantage of using the FIFO process-costing method is that:

• A) FIFO makes the unit cost calculations simpler
• B) in contrast with the weighted-average method, FIFO is considered GAAP
• C) FIFO provides managers with information about changes in the costs per unit from one period to the next
• D) in the period of rising prices, it leads to lower operating income and lower tax payments, saving the company cash and increasing the company's value

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Definitions:

P-Wave

A type of seismic wave that compresses and expands the ground, being the fastest kind of seismic wave and the first to be recorded by seismographs during an earthquake.

Velocity

The speed of something in a given direction.

Density

A physical property that describes the mass of a substance per unit volume.

Reflection

In geology, the process by which seismic waves bounce off layers within Earth's interior, helping to understand sub-surface structures.