Walton Company Collected $14,400 in May of 2021 for 4

question 137

Multiple Choice

Walton Company collected $14,400 in May of 2021 for 4 months of service which would take place from October of 2021 through January of 2022.The revenue reported from this transaction during 2021 would be:

• A)$0.
• B)$10,800.
• C)$14,400.
• D)$3,600.

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Definitions:

Conversion Costs

Conversion costs represent the combined costs of direct labor and manufacturing overheads incurred to convert raw materials into finished goods.

Equivalent Unit

A measurement used in process costing to equate the work done on units in progress to a number of fully completed units.

Weighted-Average Method

An inventory valuation method that calculates the cost of goods sold and ending inventory based on the average cost of all units available.

Conversion Costs

Costs incurred to convert raw materials into finished goods, including direct labor and manufacturing overhead.