An Automatic Increase in a Wage Rate Found in Some

question 94

Multiple Choice

An automatic increase in a wage rate found in some contracts is known as a

• A) change of labor agreement.
• B) cost of labor arrangement.
• C) cost of living adjustment.
• D) charge for living amendment.

Distinguish between direct materials, direct labor, and factory overhead costs in process costing.

Calculate total conversion costs.

Apply the concept of equivalent units for both direct materials and conversion costs.

Compute the costs per equivalent unit for both materials and conversion costs.

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Definitions:

Equilibrium Price

The cost at which the amount of a product or service that consumers want to buy matches the amount that producers are willing to sell.

Equilibrium Quantity

The quantity of goods or services supplied and demanded at the equilibrium price, where market supply and demand balance.

Quantity Demanded

The collective measure of a commodity or service that people are eager and have the means to purchase at an identified price level.

Quantity Supplied

Refers to the total amount of a good that producers are willing to sell at a given price over a specific period.