The 1,000 Accounts Receivable of Baker Company Have a Total

question 33

Multiple Choice

The 1,000 accounts receivable of Baker Company have a total book value of $30,000 (Average book value = $30) .Wendy Duffo,CPA,has selected and audited a sample of 50 accounts with the following mean values:
1.Book value of $29.00
2.Audited value of $29.50.
-What is the estimated total audited value using difference estimation sampling?

• A)$29,000.
• B)$29,500.
• C)$30,517.
• D)$30,500.

---

Definitions:

Conversion Cost

The sum of labor costs and overhead costs used to convert raw materials into finished products.

Equivalent Unit

A measure used in cost accounting to express the amount of materials or labor in terms of the number of finished units they represent.

Process Costing

An accounting methodology used for homogeneous products, which calculates the cost of a product at various stages of production by spreading the total costs over the total units produced.

Work In Process

Refers to materials that have been partially completed in production but are not yet finished goods in manufacturing.