Using the weighted average method, whenever units in process are produced to a different percentage of completion for materials and labor, this creates a condition where:
A) The number of equivalent units in process will invariably be different for materials and conversion costs.
B) The cost per equivalent unit for materials and conversion will be equal.
C) It is inappropriate to use the process costing method.
D) None of the above

Question

Quizplus · Accepted Answer

Anytime the percentage of completed is different for materials and conversion costs for the units in process during the period, the equivalent completed units will be different for these two cost components. Often all materials costs are added at the beginning of the process, but conversion costs (labor and overhead) are added throughout the process, so it is common for the number of equivalent units for materials cost to be larger than the equivalent units for conversion costs.

Using the Weighted Average Method, Whenever Units in Process Are