The Use of the FIFO Method Would Result in the Quantity

question 57

Multiple Choice

The use of the FIFO method would result in the quantity schedule of a company's production report showing

• A)units transferred out as one amount with no distinction made for beginning stock.
• B)units transferred out as two amounts-one for beginning stock and the other for units started and completed during the month.
• C)units transferred out as two amounts-one for units completed during the period and one for ending stock.
• D)units transferred out as three amounts-one for beginning stock, one for units started and completed during the period, and one for ending stock.

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Definitions:

Weighted Average

A calculation that takes into account the varying degrees of importance of the numbers in a data set.

Net Realizable Value

The estimated selling price of goods minus the costs of their sale or disposal.

Lower of Cost

An inventory valuation method requiring inventory to be recorded at the lower of its historical cost or current market value.

LIFO

Last In, First Out, an inventory valuation method where the most recently produced items are the first to be expensed.