Norfolk Engineering Uses the Weighted-Average Method in Its Process Costing

question 12

Multiple Choice

Norfolk Engineering uses the weighted-average method in its process costing system. This month, the beginning stock in the first processing department consisted of 700 units. The costs and percentage completion of these units in beginning stock were: $\begin{array}{lrr}&& \text { Percent}\\& \text { cost}& \text { complete}\\ \text { Materials costs } &£ 12,000& 65 \%\\ \text { Conversion costs } &£ 2,000 & 10 \%\\\end{array}$

A total of 9,200 units were started and 8,300 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month: $\begin{array}{l}\text { Materials costs ............ }&£200,800 \\\text { Conversion costs ......... }&£225,500 \\\end{array}$

The ending stock was 75% complete with respect to materials and 15% 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.
- The cost per equivalent whole unit for the month in the first processing department is closest to:

• A)£44.47
• B)£53.05
• C)£49.04
• D)£51.98

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Definitions:

Natural Food Chains

A sequence of organisms each dependent on the next as a source of food, demonstrating the flow of energy and nutrients in an ecosystem.

Conversion Efficiency

A measure of how effectively a system converts input energy into output energy or work.

Food Pyramid

A visual representation to illustrate the recommended balance of different food groups in a healthy diet.

Available Energy

The portion of energy in a system that can be used to perform work.