Red Manufacturing Uses a Process Cost System to Manufacture Sensors

question 81

Multiple Choice

Red Manufacturing uses a process cost system to manufacture sensors for the security industry. The following information pertains to operations for the month of October.
The beginning inventory was 60% complete for materials and 20% complete for conversion costs. The ending inventory was 90% complete for materials and 40% complete for conversion costs.
Costs pertaining to the month of October area as follows:
Beginning inventory costs: materials, $54,560; conversion cost, $35,560.
Costs incurred during October: materials used, $468,000; conversion cost, $574,040.

-Refer to the Figure.What would be the total equivalent units of production for direct materials when using the weighted average method?

• A)92,000
• B)101,600
• C)113,600
• D)116,000

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Definitions:

Carpet Dealer

A business or individual specialized in selling carpets, often offering a range of designs, materials, and sizes.

Vertical Integration

The strategy of a company expanding its operations into different stages of production or distribution within the same industry, often to control the supply chain or reduce costs.

Joint Venture

A business arrangement where two or more parties agree to pool their resources for the purpose of accomplishing a specific task.

Reduced Risk

The outcome of actions taken to minimize the probability or impact of uncertain or negative events.