Bradford Electronics Uses the Weighted-Average Method in Its Process Costing

question 58

Multiple Choice

Bradford Electronics uses the weighted-average 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 whole unit for the month in the first processing department is closest to:

• A)£39.27
• B)£46.59
• C)£49.39
• D)£52.66

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Definitions:

Direct Labor-Hours

The sum of hours contributed by workers directly participating in the creation of a product or the execution of a service.

Variable Manufacturing Overhead

Costs in manufacturing that vary directly with the level of production output, such as utilities and raw materials.

Fixed Manufacturing Overhead

Costs associated with manufacturing that remain constant regardless of the level of production, such as rent and salaries of managerial staff.

Machine-Hours

A measurement unit used in accounting and manufacturing to allocate costs to products based on the number of hours machines are operated during the production process.