Selah Manufacturing Makes a Quality-Improvement Device for the Aeronautical Industry

question 1

Multiple Choice

Selah Manufacturing makes a quality-improvement device for the aeronautical industry. The company uses a process costing system and has only a single processing department. The following information pertains to operations for the month of May:
$\begin{array} { | l | r | } \hline & \text { Number of Units } \\\hline \text { Beginning work in process inventory } & 16,000 \\\hline \text { Units started into production during May } & 100,000 \\\hline \text { Units completed during May } & 92,000 \\\hline \text { Ending work in process inventory } & 24,000 \\\hline\end{array}$ The beginning work-in-process inventory was 60% complete with respect to materials and 20% complete with respect to conversion costs. The ending work-in-process inventory was 90% complete with respect to materials and 40% complete with respect to conversion costs. The costs were as follows:
$\begin{array} { |l | r | r | r | } \hline & \text { Materials } & \text { Conversion } & \text { Total } \\\hline \begin{array} { l } \text { Beginning work-in- } \\\text { process inventory }\end{array} & \$ 54,560 & \$ 35,560 & \$ 90,120 \\\hline \begin{array} { l } \text { Costs incurred } \\\text { during May }\end{array} & \$ 468,000 & \$ 574,040 & \$ 1,042,040 \\\hline \text { Total } & \$ 522,560 & \$ 609,600 & \$ 1,132,160 \\\hline\end{array}$
-What was the unit cost for materials included in the beginning work-in-process inventory,rounded to the nearest cent?

• A) $3.41.
• B) $4.60.
• C) $5.68.
• D) $8.53.

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Definitions:

Supplier Evaluation

The process of assessing and reviewing a supplier's performance and capacity to meet contractual obligations and quality standards.

Defects Measurement

The process of identifying, quantifying, and analyzing defects in products or services to improve quality and customer satisfaction.

Buyer-supplier Network

A system of organizations, people, technology, activities, information, and resources involved in moving a product or service from supplier to buyer.

Informal System

A network or process within an organization that is not officially sanctioned but emerges from the relationships and social networks among employees.