The Assembly Department of Smart Computers Had a Beginning Inventory

question 7

Multiple Choice

The Assembly Department of Smart Computers had a beginning inventory of 5,000 units. During November, it assembled 2,000 units and transferred them to the Packaging Department. It incurred $250,000 in direct materials and $75,000 in conversion costs. The ending inventory in November was 3,000 units which were 100% and 60% complete with respect to materials and conversion costs, respectively. Calculate the total equivalent units of production for conversion costs for November.

• A)2,000 units
• B)5,000 units
• C)3,800 units
• D)1,800 units

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Definitions:

IRS

The Internal Revenue Service, a U.S. federal agency responsible for the collection of taxes and enforcement of tax laws.

3%

An interest rate, tax rate, or other percentage that signifies a portion or rate out of a hundred.

Failure to File Penalty

A penalty imposed by tax authorities on taxpayers who do not file their tax returns by the due date.

Tax Liability

The total amount of tax that individuals or businesses are legally obligated to pay to a taxing authority.