Beta Tools Ltd

question 20

Essay

Beta Tools Ltd.uses the weighted-average method of process costing.Materials are added at the beginning of the machining process and conversion costs are added evenly throughout the process.The following activity occurred in its Machining Department during November.
Units:

Costs:

Required
1.Summarize flow of physical units and compute total equivalent units for three cost categories: transferred-in,direct materials,and conversion costs.
2.Summarize total costs to account for and compute the cost per equivalent unit for each cost category.
3.Assign total costs to (a)units completed and transferred to Finished Goods Inventory and (b)units in November 30 Work in Process Inventory.

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Definitions:

Operating Cash Flow

The cash generated from a company's normal business operations before financing and investment activities.

Net Capital Spending

The total expenditure on fixed assets less any sales of fixed assets during a given period, often used in assessing a company's investment in physical assets.

Earnings Before Interest And Taxes

A financial performance measure that calculates a company's profitability by excluding interest and taxes expenses.

Marginal Tax Rate

The rate of additional federal income tax to be paid on an additional dollar of income, which varies depending on income levels and filing status.