_______________ is a unit-costing method that merges prior-period work and costs with current-period work and costs.

Question

Quizplus · Accepted Answer

The weighted average method is a unit-costing method that blends together the costs and activity levels from both the current and previous periods. This method takes the total cost of beginning inventory and adds it to the total cost of goods manufactured during the period, then divides by the total number of units to calculate an average cost per unit. This average cost is then applied to the ending inventory to determine its value, as well as to the cost of goods sold to determine the cost of goods sold during the period. Therefore, the weighted average method takes into account the costs incurred in both the current and previous periods, making it a useful method for companies with a lot of inventory turnover or those that experience fluctuations in production levels. The other options are not blending costs from the previous period but are methods to calculate inventory or production costs.

_______________ Is a Unit-Costing Method That Merges Prior-Period Work and Costs