Universal Automotive Group Is a Maker of Engines for High

question 77

Multiple Choice

Universal Automotive Group is a maker of engines for high performance cars and uses a process costing system. The following information pertains to the final department of manufacturing for Universal's most popular engine, the "Atomic 8". $\begin{array}{lr}\text { Beginning work-in-process ( } 40 \% \text { completed) } & 400 \text { units } \\\text { Transferred-in } & 1,600 \text { units } \\\text { Normal spoilage } & 100 \text { units } \\\text { Abnormal spoilage } & 100 \text { units } \\\text { Good units transferred out } & 1,400 \text { units } \\\text { Ending work-in-process }(25 \% \text { completed) } & 400 \text { units }\\\text { Conversion costs in beginning inventory } & \$ 180,500 \\\text { Current conversion costs } & \$ 728,218\end{array}$ Universal Automotive Group calculates separate costs of spoilage by computing both normal and abnormal spoiled units. Normal spoilage costs are reallocated to good units and abnormal spoilage costs are charged as a loss. The units of the Atomic 8 that are spoiled are the result of defects not discovered before inspection of finished units. Using the weighted-average method, answer the following question:
What are the equivalent units for conversion costs?

• A) 1,700 units.
• B) 1,800 units.
• C) 1,900 units.
• D) 2,000 units.

---

Definitions:

Permission Marketing

A marketing strategy where businesses seek consent from consumers before sending them promotional messages or advertisements.

Online Advertising

A form of marketing and advertising which uses the Internet to deliver promotional marketing messages to consumers.

E-mail

A method of exchanging messages between people using electronic devices, allowing for instant communication across long distances.

Domain Names

The readable names used to identify IP addresses on the internet, forming part of the URLs that direct users to websites.