During April,the Production Department of a Process Operations System Completed

question 137

Multiple Choice

During April,the production department of a process operations system completed and transferred to finished goods 18,000 units that were in process at the beginning of April and 90,000 units that were started and completed in April.April's beginning inventory units were 100% complete with respect to materials and 40% complete with respect to labor.At the end of April,30,000 additional units were in process in the production department and were 100% complete with respect to materials and 60% complete with respect to labor.The beginning inventory included materials cost of $107,000 and the production department incurred direct materials cost of $329,000 during the month.Compute the direct materials cost per equivalent unit for the department using the weighted-average method.

• A)$4.03.
• B)$3.05.
• C)$2.38.
• D)$3.16.
• E)$2.57.

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Definitions:

Ending Inventory

The value of goods available for sale at the end of an accounting period, not yet sold.

GAAP

A set of rules and standards designed to improve and standardize accounting practices, making financial statements comparable across companies.

IFRS

International Financial Reporting Standards, which are a set of accounting standards developed by the International Accounting Standards Board (IASB) for global use.

Lower Of Cost Or Market

A method that values inventory at the lower of its historical cost or its current market price.