A Company Uses a Process Costing System

question 166

Multiple Choice

A company uses a process costing system.Its Welding Department completed and transferred out 100,000 units during the current period.The ending inventory in the Welding Department consists of 30,000 units (75% complete with respect to direct materials and 40% complete with respect to conversion costs) . Determine the equivalent units of production for the Welding Department for direct materials and conversion costs assuming the weighted average method.

• A)130,000 materials; 130,000 conversion.
• B)130,000 materials; 112,000 conversion.
• C)107,500 materials; 118,000 conversion.
• D)122,500 materials; 112,000 conversion.
• E)112,500 materials; 130,000 conversion.

Understand the concept of short-run and long-run equilibria in monopolistic competition.

Determine the efficient scale of production for a monopolistically competitive firm.

Assess the impact of firm behavior on profits in different market structures.

Analyze the conditions that lead to the entry and exit of firms in monopolistically competitive markets.

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Definitions:

Perpetual Inventory System

An inventory management method where updates are made continually to record each sale or purchase of inventory.

Inventory Ledger

A detailed record maintaining the quantity and value of a company's inventory over time.

Purchases Journal

An accounting ledger in which purchases of goods on credit are recorded.