Mannarelli Corporation Uses the FIFO Method in Its Process Costing

question 24

Multiple Choice

Mannarelli Corporation uses the FIFO method in its process costing system.Operating data for the Casting Department for the month of September appear below: According to the company's records,the conversion cost in beginning work in process inventory was $15,660 at the beginning of September.Additional conversion costs of $526,524 were incurred in the department during the month. The cost per equivalent unit for conversion costs for September is closest to: (Round off to three decimal places. )

• A)$5.916
• B)$5.340
• C)$5.220
• D)$5.213

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Definitions:

Perfect Tender Rule

The requirement that a seller deliver goods in conformity with the contract, down to the last detail.

Rigidity

The quality of being unable to bend or be forced out of shape; lack of flexibility or adaptability.

Honesty in Fact

The genuine belief or actual state of mind devoid of intent to deceive or defraud.

Good Faith

An honest intention to act without taking an unfair advantage over another party, typically related to the fulfillment of contracts and agreements.