Department a Had No Work-In-Process at the Beginning of the Period

question 39

Multiple Choice

Department A had no Work-in-Process at the beginning of the period, 1,000 units were completed during the period, 200 units were 50% completed at the end of the period, and the following manufacturing costs were debited to the departmental Work-in-Process account during the period:
$$\begin{array} { l r } \text { Direct materials } ( 1,200 \text { at } \$ 10 ) & \$ 12,000 \\\text { Direct labor } & 5,500 \\\text { Factory overhead } & 4,400\end{array}$$
Assuming that all direct materials are added at the beginning of production and Department A uses weighted-average process costing, what is the total cost of the departmental Work-in-Process Inventory at the end of the period?

• A) $3,650.
• B) $2,900.
• C) $2,000.
• D) $1,825.

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Definitions:

Labour Hours

The total number of hours worked by employees during a specific period, often used to measure labor input in producing goods or services.

Variable Overhead Efficiency Variance

The difference between the actual variable overhead costs incurred and the expected (or standard) costs for the achieved level of production.

Fixed Overhead Volume Variance

The difference between the budgeted and applied fixed overhead costs, attributed to variations in production volume.

Denominator Activity

relates to the level of activity used to allocate fixed overhead costs to units produced, which can affect the unit cost of production.