The Morgan Company Uses the Weighted-Average Method in Its Process

question 2

Multiple Choice

The Morgan Company uses the weighted-average method in its process costing system.For a particular department,the company had 54,000 equivalent units of production with respect to conversion costs in March.There were 7,500 units in the department's beginning work in process inventory,two thirds complete with respect to conversion costs.During March,52,500 units were started and 50,000 were completed and transferred out of the department.The ending work in process inventory in the department?

• A) consisted of 2,500 units.
• B) consisted of 5,000 units.
• C) was 40% complete with respect to conversion costs.
• D) was 65% complete with respect to conversion costs.

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Definitions:

Finished Goods

Products that have completed the manufacturing process but have not yet been sold to customers.

LIFO Inventory Method

An inventory valuation method that assumes the last items placed in inventory are the first sold during an accounting period; stands for Last-In, First-Out.

Inventory Costing Methods

Techniques used to assign costs to inventory items, such as First-In, First-Out (FIFO), Last-In, First-Out (LIFO), and weighted average cost.