Leeds Electronics Uses the FIFO Method in Its Process Costing

question 3

Multiple Choice

Leeds Electronics uses the FIFO method in its process costing system. Data concerning the first processing department for the most recent month is 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 cost per equivalent unit for conversion costs for the first department for the month is closest to

• A)£44.51
• B)£50.00
• C)£46.92
• D)£46.74

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Definitions:

Conversion Cost

The combined costs of direct labor and manufacturing overheads, which are necessary to convert raw materials into finished goods.

Direct Materials

Key substances exclusively used in the generation of specific products or execution of services.

Period Cost

Costs that are expensed in the period in which they are incurred, typically related to selling, general, and administrative activities rather than production.

Selling and Administrative Expense

The combined total of all expenses directly related to the selling of products and the administration of a business.