The General Ledger of Oates Company Has the Following Work

question 107

Essay

The general ledger of Oates Company has the following work in process account.
Production records show that there were 2,000 units in beginning inventory, 50% complete; 8,000 units started, and 4,500 units transferred out. The beginning work in process had conversion costs of $3,150. The units in ending inventory were 60% complete. Materials are added at the beginning of the process.
Instructions
Answer the following questions.
(a) How many units are in process at June 30?
(b) What is the unit conversion cost for June?
(c) What is the conversion cost in the June 30 inventory?

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Definitions:

Allocative Efficiency

A state of the economy in which production is in accordance with consumer preferences; every good or service is produced up to the point where the last unit provides a marginal benefit to consumers equal to the marginal cost of producing it.

Price Discrimination

A pricing strategy where a company sells the same product or service at different prices to different customers, often based on their willingness to pay.

Pure Monopoly

A market structure where a single firm controls the entire supply of a product or service, with no close substitutes available, allowing it to influence price significantly.

Economies of Scale

Refers to the cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output decreasing with increasing scale.