Use the Information Below to Answer the Following Questions

question 151

Multiple Choice

Use the information below to answer the following questions:
Pizza Company produces frozen pizzas in three departments: assembly, freezing and packaging. In assembly, crust ingredients are added at the beginning of the process. After the crust is made, the sauce, cheese, and toppings are added at the end of the process. Conversion costs are added evenly. Data for the assembly department includes:

-At Pizza Company the cost per equivalent unit for material costs would be closest to

• A) $2.62.
• B) $2.50.
• C) $1.00.
• D) $0.50.

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Definitions:

Work in Process

Refers to the total cost of unfinished goods in the manufacturing process at any given time.

Estimated Overhead Costs

The anticipated costs for overhead activities in a business, including utilities, rent, and management salaries, not directly tied to product production.

Overapplied Overhead

A situation where the estimated overhead costs allocated to products or services exceed the actual overhead costs incurred.

Manufacturing Overhead Costs

Expenses related to the manufacturing process that are not directly tied to the production of goods, such as utilities and rent for the manufacturing space.