In the computation of manufacturing cost per equivalent unit, the weighted-average method of process costing considers
A. Current costs only.
B. Current costs plus cost of beginning work in process inventory.
C. Current costs less cost of beginning work in process inventory.
D. Current costs plus cost of ending work in process inventory.
Answer:B
B is corrent. When computing equivalent units of production under the weighted-average method, the work done last period on beginning work in process (BWIP) is considered. Therefore, when computing cost per equivalent unit, the cost associated with BWIP must be added to the current costs.
A is incorrect because it is the FIFO method which considers current costs only.
C is incorrect because the cost in BWIP is added to and not subtracted from current costs.
D is incorrect because beginning and not ending work in process costs are added to current costs.
