Hache Corporation Uses the Weighted-Average Method in Its Process Costing

question 63

Multiple Choice

Hache Corporation uses the weighted-average method in its process costing system. Data concerning the first processing department for the most recent month are listed below: Note: Your answers may differ from those offered below due to rounding error. In all cases, select the answer that is the closest to the answer you computed. To reduce rounding error, carry out all computations to at least three decimal places. The total cost transferred from the first processing department to the next processing department during the month is closest to:

• A)$231,700
• B)$274,893
• C)$205,005
• D)$215,900

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Definitions:

Short Run

A period in which at least one factor of production is fixed, limiting the ability of a business to adjust fully to changes in market conditions.

Average Variable Costs

Costs that vary with the level of output, calculated by dividing the total variable costs by the quantity of output produced.

Shutting-Down

A short-run decision by a firm to halt production because operating would lead to a loss greater than the fixed costs.

Hostages

Individuals held captive by others as security for the fulfillment of specific conditions or demands.