ECONOMICS

Detailed explanation-1: -Both statements are true. The EUP will be the same under FIFO method and weighted average methos if there is no beginning work in process inventory. In process costing the cost per unit in a department is found by spreading the period’s production costs over the production activity.

Detailed explanation-2: -Weighted Average EUP Calculation for Conversion Costs Again, all units transferred out during the current period are multiplied by 100 percent when calculating EUP for weighted average costing. Ending WIP units are multiplied by the percentage they are considered complete with respect to conversion costs.

Detailed explanation-3: -The correct answer is a. If there is no beginning work in process inventory, both methods would result the same equivalent units.

Detailed explanation-4: -The weighted average and FIFO methods differ only in how they treat beginning inventory. The FIFO method requires that any units in beginning inventory be costed separately from any units started in the current period. The weighted-average method of process costing is simpler than the FIFO method.