Jasper Company Uses the Weighted Average Process Costing Method

question 19

Multiple Choice

Jasper Company uses the weighted average process costing method.The Mixing Department at Jasper had 17,000 units in beginning inventory.These units contained $88,000 in direct materials,$80,000 in direct labor,and $60,000 in overhead.During the period,the department incurred costs of $300,000 in direct materials,$400,000 in direct labor and $200,000 in overhead and started 80,000 units.Ending inventory consisted of 6,000 units which were 100% complete with respect to direct materials and 50% complete with respect to direct labor and overhead.What is the cost per equivalent unit for materials (rounded to the nearest cent) ?

• A)$4.12
• B)$4.26
• C)$3.76
• D)$4.00
• E)None of the answer choices is correct.

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Definitions:

Book Value

Represents the net value of a company's assets as recorded on the balance sheet, calculated as assets minus liabilities.

Fair Value

The market-based measurement of the value of an asset or liability based on current transactions between willing parties, outside of a forced liquidation or distress sale.

Acquisition Method

An accounting technique used in consolidations that involves recording the assets and liabilities of a company being acquired at their fair value at the date of acquisition.

Consolidated Balance Sheet

A financial statement that aggregates the total assets, liabilities, and equity of a parent company and its subsidiaries.