Bing Manufacturing Uses a Weighted-Average Process-Costing System

question 15

Multiple Choice

Bing Manufacturing uses a weighted-average process-costing system. All materials are introduced at the start of manufacturing, and conversion costs are incurred evenly throughout the process. The company's beginning and ending work-in-process inventories totaled 30,000 units and 35,000 units, respectively, with the latter units being 40% complete at the end of the period. Bing started 30,000 units into production and completed 25,000 units. Manufacturing costs were as follows: Beginning work in process: Materials, $100,000; conversion cost, $200,000
Current work in process: Materials, $160,000; conversion cost, $450,000.
Bing's equivalent-unit cost for materials is:

• A)$2.67.
• B)$4.00.
• C)$4.33.
• D)$7.20
• E)$10.40.

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Definitions:

Net Income

Net income is the total profit of a company after all expenses, including taxes and costs, have been subtracted from revenues.

Indirect Method

The indirect method is a way of calculating cash flows from operating activities for the cash flow statement by starting with net income and adjusting for changes in balance sheet accounts.

Liquidity

The simplicity of turning an asset into cash without impacting its market value.

Cash Flows From Operations

The net amount of cash generated or used by a company in its operational activities during a specific period.