Which of the following statements is(are)true? I.For cost control,the FIFO method of process costing is better than the weighted-average method.II.The weighted-average method of process costing assigns more cost to units completed (transferred out)than the FIFO method.

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Quizplus · Accepted Answer

The FIFO method of process costing assigns the earliest costs incurred to the units completed (transferred out) first. This means that the units completed in a period will have a lower cost than if the weighted-average method were used. The weighted-average method assigns an average cost to all units completed in a period, regardless of when the costs were incurred. This means that the units completed in a period will have a higher cost than if the FIFO method were used.

Which of the Following Statements Is(are)true? I