Gajewski Began Operations on January 1 of the Current Year

question 71

Multiple Choice

Gajewski began operations on January 1 of the current year. The company uses a process-costing system, and conversion cost is incurred evenly throughout manufacturing. By January 31, the firm had completed 56,000 units. Which of the following statements is true about the ending work-in-process inventory if equivalent units for conversion cost totaled 59,000 units?

• A) There is no ending work-in-process inventory.
• B) The ending work-in-process inventory totaled 3,000 physical units.
• C) The ending work-in-process inventory of 10,000 physical units was 30% complete.
• D) The ending work-in-process inventory of 20,000 physical units was 85% complete.
• E) More than one of the other answers is true.

---

Definitions:

Subsidiary Acquired

A business entity whose control is obtained by another entity (parent company) through the acquisition of its majority voting stock.

Financing Cash Flows

Cash flows associated with the raising of capital and repayment of borrowings, including issuing and repurchasing shares, and payment of dividends.

Subsidiaries Acquired

Refers to companies that have been bought and are now controlled by a parent company, becoming part of a larger corporate family.