1. In comparing WA and FIFO methods, which of the following is not true?

a)	If manager's compensation is based on operating income, the manager may prefer WA method, which increase operating income even though it results in higher tax payments.

b)	In a period of rising prices, the weighted-average method will decrease taxes because cost of goods sold will be higher and operating income lower.

c)	In a period of falling prices, the higher the cost of goods sold under FIFO will lead to lower operating income and lower tax payments, saving the company cash and increasing the company's value.

d)	WA provides managers with information about changes in the costs per unit from one period to the next.

2. Which of the following is not true with respect to hybrid-costing and operation costing?

a)	An operation-costing system is a hybrid costing system applied to identical products.

b)	A hybrid-costing system blends characteristics from both job costing and process costing.

c)	A hybrid-costing system uses process costing to account for CC and job costing for materials and customizable components.

d)	Hybrid costing is commonly used by manufacturers of televisions, dishwashers, and washing machines.

3. Which of the following is not true with in comparing WA method and FIFO method?

a)	FIFO assumes that all units from previous period in BWIP are the first to be completed and transferred out.

b)	In FIFO, work done on the beginning inventory before the current period is kept separate from work done in the current period.

c)	In a situation where there is no BWIP and some EWIP, the manager must select either WA or FIFO for inventory purposes.

d)	Using WA method, the beginning balance of WIP account is blended in with current period costs.