James CoUses Process Costing to Account for the Production of Bottled

question 10

Multiple Choice

James Co.uses process costing to account for the production of bottled energy drinks.Direct materials are added at the beginning of the process and conversion costs are incurred uniformly throughout the process.Equivalent units have been calculated to be 10,000 units for materials and 9,000 units for conversion costs.Beginning inventory consisted of $7,000 in materials and $4,000 in conversion costs.April costs were $36,000 for materials and $41,000 for conversion costs.Ending inventory still in process was 4,000 units (100% complete for materials,75% for conversion) .The value of units completed and transferred out using the weighted average method would be closest to:

• A)$37,200.00
• B)$55,800.00
• C)$76,000.00
• D)$79,833.00

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Definitions:

Equity Method

An accounting technique used to record investments in other companies, where the investment is initially recorded at cost and subsequently adjusted to reflect the investor's share of the investee's profits or losses.

Permanent Loss

A decrease in the value of an asset or investment that is not expected to be recovered over time.

Equity Method

A financial recording method where investments in other firms are initially noted at their purchase price and later updated to represent the investor's portion of the investee's profits or losses.

Fair-Value Method

An accounting approach where assets and liabilities are recorded at their current market values rather than their original cost.