ECONOMICS

Detailed explanation-1: -weighted average method: combines beginning inventory costs (prior period work) with costs from current period work. 2. first-in, first-out (FIFO) method: separates beginning inventory costs (prior period work) from costs of current period work.

Detailed explanation-2: -FIFO stands for “First-In, First-Out”. It is a method used for cost flow assumption purposes in the cost of goods sold calculation. The FIFO method assumes that the oldest products in a company’s inventory have been sold first. The costs paid for those oldest products are the ones used in the calculation.

Detailed explanation-3: -The first-in-first-out (FIFO) method keeps beginning inventory costs separate from current period costs and assumes that beginning inventory units are completed and transferred out before the units started during the current period are completed and transferred out.

Detailed explanation-4: -Equivalent units for a process costing system using the FIFO method would be equal to: a. units completed during the period, plus equivalent units in the ending work in process inventory.