The Taylor Company Uses a Process Costing System

question 39

Multiple Choice

The Taylor Company uses a process costing system. Assume that direct materials are added at the beginning of the period and that direct labor and overhead are added continuously throughout the process. The company uses the average costing method. The following data are available for one of its accounting periods: Assume that you have calculated a direct materials cost per unit of $5 and a conversion cost per unit of $8. Under this assumption, the ending balance for Work in Process Inventory would be

• A) $147,000.
• B) $165,000.
• C) $123,000.
• D) $195,000.

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Definitions:

Transportation Costs

Expenses associated with the movement of goods or people from one location to another.

Premium

A payment to an insurance company in return for the promise to pay a claim in certain states of the world.

Insurance Company

A business entity that provides financial protection and compensation for losses to individuals and entities in exchange for premium payments.

Medical Bills

Expenses incurred for receiving medical treatment and health services.