Under the first-in,first-out (FIFO)method,the current period equivalent units of production for transferred in units in beginning inventory are zero because ________.
A) these units are transferred back to the previous department for further processing in the current period
B) these units are expected to be sold by the receiving department without subjecting them to further processing
C) no additional costs for these units were incurred in the current period
D) costs involved in inter-departmental transfers are accounted for only once when sales are made to customers

Question

Quizplus · Accepted Answer

Under the FIFO method, the costs associated with transferred-in units are assumed to have been incurred in a previous period. Therefore, these units are not included in the calculation of equivalent units of production for the current period, as no additional costs were incurred in the current period.

Under the First-In,first-Out (FIFO)method,the Current Period Equivalent Units of Production