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

question 34

Multiple Choice

Carmon Corporation uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 700 units. The costs and percentage completion of these units in beginning inventory were: A total of 7,900 units were started and 6,900 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month: The ending inventory was 70% complete with respect to materials and 35% complete with respect to conversion costs. 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.
What are the equivalent units for conversion costs for the month in the first processing department?

• A)8,600
• B)7,495
• C)6,900
• D)595

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Definitions:

Personal Liability

The legal responsibility of an individual to settle debts or damages out of their own assets.

Gross Revenues

The total amount of money earned by a business before any deductions or expenses are subtracted.

Indirectly Own Stock

Holding shares in a company through indirect means, such as owning a mutual fund or an exchange-traded fund that in turn owns the stock.

Ultra Vires Doctrine

A legal principle that acts of a corporation must fall within the limits of the powers granted by law and the corporation's own constitution.