Concept explainers
Concept introduction:
Process costing systems is a system to assign the costs where the production goes through different processes. A product may take several processes to complete and when these processes are separable, the process costing system is applied to ascertain the cost of each process.
Weighted average method:
Weighted average method is one of the methods of process costing, under this method the cost of beginning work in process is mixed with the current period cost and weighted cost and equivalent units are calculated. In other words, the weighted average method does not teat the beginning work in process cost separately.
To choose:
The correct option for amounts combined when calculating the equivalent unit cost using the weighted average method
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Managerial Accounting
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- Which of the following is a conversion cost? A. raw materials B. direct labor C. sales commissions D. direct material usedarrow_forwardIn what way do the cost of production summaries in Chapter 6, prepared using the weighted average cost method, differ from the cost of production summaries presented in Chapter 5? What is the reason for this difference?arrow_forwardWhich costs are assigned using the weighted-average method?arrow_forward
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- In the cost equation Y=a+bx, Y represents which of the following? A. fixed costs B. variable costs C. total costs D. units of productionarrow_forwardWhat are the four main sections of a cost of production summary?arrow_forwardUnder absorption costing, a unit of product includes which costs? A. direct material, direct labor, and manufacturing overhead B. direct material, direct labor, and variable manufacturing overhead C. direct material, direct labor, and fixed manufacturing overhead D. direct material, direct labor, and all variable manufacturing overheadarrow_forward
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