Answer the Following Questions Using the Information Below:
Charlie Chairs

question 58

Multiple Choice

Answer the following questions using the information below:
Charlie Chairs Inc., manufactures plastic moldings for car seats. Its costing system utilizes two cost categories, direct materials and conversion costs. Each product must pass through Department A and Department B. Direct materials are added at the beginning of production. Conversion costs are allocated evenly throughout production.
$\begin{array}{ll}\text { Datafor Department A for Februay } 2015 \text { are: }\\\text { Work in process, beginning inventory, } 40 \% \text { converted } & 200 \text { units } \\\text { Units started during February } & 800 \text { units } \\\text { Work in process, ending inventory } & 100 \text { units }\\\text { Costs for Department A for February } 2015 \text { are: }\\\text { Work in process, beginuing inventory: }\\\text { Direct materials } & \$ 150,000 \\\text { Conversion costs } & \$ 200,000 \\\text { Direct materials costs added during February } & \$ 600,000 \\\text { Conversion costs added during February } & \$ 425,000\end{array}$
-What is the unit cost per equivalent unit of beginning inventory in Department A?

• A) $750
• B) $1,750
• C) $2,800
• D) $3,250

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Definitions:

Foreign Corporation

A business entity that is registered and operates in a jurisdiction or country different from where it was originally incorporated.

Incorporated

The process by which a business is legally declared a corporate entity, separate from its owners.

Piercing The Veil

A legal concept that allows courts to hold shareholders or members of a corporation personally liable for the corporation's actions or debts under certain circumstances.

Nonprofit Corporation

An organization established for purposes other than making a profit, which typically benefits the public, a specific group of individuals, or the membership of the nonprofit.