In the weighted-average costing method, the costs of direct materials in beginning
inventory are not included in the cost per unit calculation since direct materials are almost
always added at the start of the production process.
Answer: False Difficulty: 2 Objective: 5
The costs of the direct materials are included in the cost per unit calculation.
10. The FIFO process costing method merges the work and the costs of the beginning
inventory with the work and the costs done during the current period.
Answer: False Difficulty: 2 Objective: 6
FIFO only includes the work done during the current period.
11. The first-in, first-out process-costing method assumes that units in beginning inventory
are completed during the current accounting period.
Answer: True Difficulty: 2 Objective: 6
12. Process costing FIFO is usually applied to both the units entering a department and the
units leaving a department.
Answer: False Difficulty: 2 Objective: 6
FIFO is only applied to the goods transferred out.
13. Activity-based costing has more applicability in a process-costing system than in a
job-costing environment.
Answer: False Difficulty: 2 Objective: 6
Activity-based costing is less applicable to process costing because the units all go through
similar processes.
14. A major advantage of the weighted-average process costing is that it provides
managers with information about changes in the costs per unit from one period to the next.
Answer: False Difficulty: 2 Objective: 6
This is an advantage of FIFO, not the weighted-average method.
15 Standard costing is extremely useful when unique, high cost products are produced, as
compared to the production of multiple products.
Answer: False Difficulty: 2 Objective: 7
Job costing is especially useful in this situation.
