Cherrington Company Uses a Process Costing System -Assuming That Cherrington Company Uses the FIFO Method,the Conversion Costs

question 6

Multiple Choice

Cherrington Company uses a process costing system. For May, the month just completed, the beginning work-in-process inventory consisted of 50,000 units that were 60% complete with respect to conversion costs. The ending inventory for the month was 20% complete with respect to conversion costs. A summary of cost data for the month follows:
$\begin{array} {| l | r | r | } \hline & \text { Units } & \text { Conversion costs } \\\hline \begin{array} { l } \text { Work in process inventory } \\\text { on May 1 }\end{array} & 50,000 & \$ 30,000 \\\hline \begin{array} { l } \text { Units started into } \\\text { production }\end{array} & 180,000 & \\\hline \begin{array} { l } \text { Conversion costs incurred } \\\text { during May }\end{array} & & \$ 690,000 \\\hline \begin{array} { l } \text { Units completed and } \\\text { transferred out during the } \\\text { month }\end{array} & 190,000 & \\\hline\end{array}$

-Assuming that Cherrington Company uses the FIFO method,the conversion costs for work in process ending inventory in May is closest to which of the following? (Round your intermediate answers two decimal places)

• A) $34,480.
• B) $27,920.
• C) $32,880.
• D) $34,320.

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Definitions:

Controlled Processes

The most alert states of human consciousness, during which individuals actively focus their efforts toward a goal.

Automatic Processes

States of consciousness that require little attention and do not interfere with other ongoing activities.

Altered State

A mental state that is significantly different from normal waking consciousness, often resulting from meditation, drug use, hypnosis, or psychological conditions.

Subconscious Awareness

Subconscious Awareness describes the part of the mind that operates below the level of conscious thought, influencing behaviors and perceptions without direct awareness.