   Chapter 6, Problem 16MCQ ### Managerial Accounting: The Corners...

7th Edition
Maryanne M. Mowen + 2 others
ISBN: 9781337115773

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Chapter
Section ### Managerial Accounting: The Corners...

7th Edition
Maryanne M. Mowen + 2 others
ISBN: 9781337115773
Textbook Problem
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# Assume for August that Faust Manufacturing has manufacturing costs in BWIP equal to $80,000. During August, the cost incurred was$720,000. Using the FIFO method, Faust had 120,000 equivalent units for August. The cost per equivalent unit for August is a. $6.12. b.$6.50. c. $5.60. d.$6.00. e. $6.67. To determine Identify cost per equivalent units using FIFO method. Explanation First-in first out method: A method which separates the beginning inventory units from units produced during a period is known as FIFO method. In FIFO method, only cost incurred during a period is considered to calculate unit cost. d. Use the following formula to calculate cost per equivalent unit: Cost per equivalent unit=(Cost in BWIP+Cost incurred during monthEquivalent unit)=($80,000+\$

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