Watties Beverages, Ltd., of Austrlia makes blended tropical fruit juice. Following information pertains to October production in the production plant, which produces and bottles fruit drinks:

	Units	Materials	Conversion
Work in process, October 1	2,000	70% complete	60% complete
Started in October	10,000
Work in process, October 30	4,000	40% complete	25% complete
Costs:
Work in process October 1		$1,050	$3,240
Added during October		8,200	22,620

Required

1. The managing director asked you, why should we bother using FIFO? It complicates our report. We could always use weighted-average method which is simpler than FIFO. Write a report to him explaining (i) when it is right, and (ii) when it is not right to use weighted-average method. Use your calculations you did in requirements (a) and (b) to justify your answer.