A Company Uses a Process Costing System

question 143

Multiple Choice

A company uses a process costing system. Its Assembly Department's beginning inventory consisted of 30,000 units, 75% complete with respect to direct labor and overhead. The department completed and transferred out 127,500 units this period. The ending inventory consists of 20,000 units that are 25% complete with respect to direct labor and overhead. All direct materials are added at the beginning of the process. The department incurred direct labor costs of $24,000 and overhead costs of $32,000 for the period. Assuming the weighted average method, the direct labor cost per equivalent unit (rounded to the nearest cent) is:

• A) $0.16.
• B) $0.18.
• C) $0.14.
• D) $0.30.
• E) $0.37.

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Definitions:

Strength of Relationship

The degree of trust, mutual respect, and commitment between individuals or organizations in a business context.

Number of Years

A quantification of time in years, often used to measure durations such as age, experience, or timelines.

Potential Sales

The possible revenue that could be generated from selling products or services to interested customers.

Present Sales

The current number or volume of goods or services sold by a business.