In order to compute equivalent units of production using the FIFO method of process costing,work for the period must be broken down to units:
A)Completed from beginning inventory,started and completed during the month,and units in ending inventory.
B)Completed during the period and units in ending inventory.
C)Started during the period and units transferred out during the period.
D)Processed during the period and units completed during the period.

Question

Quizplus · Accepted Answer

The FIFO method assumes that units in the beginning inventory are completed first, followed by units started and completed during the period, and then units in the ending inventory. Therefore, to compute equivalent units of production using the FIFO method, work for the period must be broken down into units completed from beginning inventory, started and completed during the month, and units in ending inventory.

In Order to Compute Equivalent Units of Production Using the FIFO