Kesterson Corporation Has Provided the Following Information: If 6,500

question 212

Multiple Choice

Kesterson Corporation has provided the following information: If 6,500 units are produced, the total amount of indirect manufacturing cost incurred is closest to:

• A) $7,800
• B) $19,420
• C) $21,000
• D) $13,200

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Definitions:

Process Operations

A mode of operation in manufacturing where products are produced in continuous processes as opposed to discrete items.

Job Order Costing System

An accounting method that accumulates costs individually for each job, suitable for manufacturing upon specific orders.

Process Costing System

An accounting methodology used for homogenous products, allocating production costs to units based on the process they go through.

Equivalent Units

A concept used in process costing to convert partially completed units into a number of equivalent full units.