Suppose That You Want to Set Up a 3-Month Weighted

question 115

Multiple Choice

Suppose that you want to set up a 3-month weighted moving average forecasting system. You want the weights to be percentages (that add to 100%) . Furthermore, you want weights for the most recent two months to be equal but you want each of those weights to be twice as large as the weight for the oldest month. What should the weight be for the oldest month?

• A) 33%
• B) 25%
• C) 80%
• D) 50%
• E) 20%

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Definitions:

Milling Department

A division or area in a manufacturing facility where milling processes are carried out to shape materials into finished products or components.

Manufacturing Overhead

All indirect costs associated with manufacturing, including indirect labor, materials, and utilities, not directly tied to the production of goods.

Job-Order Costing System

A cost accounting method that captures the financial performance of individual jobs or projects, tracking direct labor, direct materials, and applied overhead per task.

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead to products or cost objects, calculated before the production starts based on estimated costs.