Mikey's Mugs Uses the FIFO Method of Process Costing

question 46

Multiple Choice

Mikey's Mugs uses the FIFO method of process costing. The company's ending work in process inventory consisted of 12,000 units that were 40% complete and had incurred 80% of the materials costs. The direct materials cost per equivalent unit was $2.40, and the conversion cost per equivalent unit was $3.30. What is the amount of cost Mikey would assign to ending work in process inventory?

• A) $27,360
• B) $38,880
• C) $46,800
• D) $68,400

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Definitions:

Intraorganizational

Pertaining to activities, processes, or interactions that occur within a single organization.

Extraorganizational

Activities, processes, or relationships that exist or occur outside of an organization's own boundaries.

HR

Stands for Human Resources, a department within organizations focused on managing employee-related processes like hiring, training, and benefits administration.

CIM

Computer Integrated Manufacturing, an approach to manufacturing that integrates computer systems with physical manufacturing processes for efficiency and productivity improvements.