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As a company decides between using the First-In, First-Out (FIFO) or Weighted-Average method for its process costing, a number of factors must be considered. Management
As a company decides between using the First-In, First-Out (FIFO) or Weighted-Average method for its process costing, a number of factors must be considered. Management should always ensure that they have taken the proper time to consider all factors as companies are urged to apply the same method from year to year and switching between methods later on will not likely be possible. Which of the following is a rationale for selecting the Weighted-Average rather than the FIFO method? The Weighted-Average method is more costly than the FIFO method. The Weighted-Average method is the best fit when individual units are easy to identify separately. The Weighted-Average method is the best fit when individual units are impossible to identify separately. The Weighted-Average method is the more accurate method but also takes more time
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