Final answer:
The disadvantage of the weighted average costing method is that it combines the performance of the current period with that of a prior period, which may misrepresent actual profitability and economic performance.
Step-by-step explanation:
The question relates to the disadvantages of the weighted average costing method in accounting. Specifically, the answer to the question is option d: It combines the performance of the current period with that of a prior period. The basic idea of the weighted average costing method is that it averages the costs of goods available for sale during an accounting period and uses this average to value the ending inventory and the cost of goods sold. One disadvantage of this method, particularly in times of inflation or changing costs, is that it may blend together different cost levels from past production with current production, which could potentially misrepresent the actual performance by obscuring economic profit, which is calculated as total revenues minus total costs (explicit plus implicit costs).
Moreover, while understanding the concept of diseconomies of scale, where long-run average cost of producing output increases as total output increases, it is relevant to consider that if a company grows excessively, its management can become cumbersome and lead to inefficiencies, which is not directly related to the costing method but can affect cost calculations in large firms when using weighted average costing.