Darden Company Uses the Weighted-Average Method in Its Process Costing

question 10

Multiple Choice

Darden Company uses the weighted-average method in its process costing system. The first processing department, the Welding Department, started the month with 18,000 units in its beginning work in process stock. These units were 10% complete with respect to conversion costs. The conversion cost in this beginning work in process stock was £16,200. An additional 84,000 units were started into production during the month. 17,000 units were in the ending work in process stock of the Welding Department. These units were 70% complete with respect to conversion costs. A total of £836,880 in conversion costs were incurred in the department during the month. What would be the cost per equivalent unit for conversion costs for the month? (Round off to three decimal places.)

• A)£8.286
• B)£9.000
• C)£8.804
• D)£9.963

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Definitions:

Supply of Labor

The total hours that workers are willing and able to work at a given wage rate.

Wages

Remuneration provided to laborers for their services, usually based on an hourly, daily, or task-completion method.

Total Compensation

The complete pay package for employees including all forms of money, benefits, services, and in-kind payments.

Direct Payments

Cash transfers from the government to individuals or businesses for various purposes without any requirement for reciprocation.