Morvan Corporation Uses the FIFO Method in Its Process Costing

question 33

Multiple Choice

Morvan Corporation uses the FIFO method in its process costing system. Data concerning the first processing department for the most recent month are 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.
-The total cost transferred from the first processing department to the next processing department during the month is closest to:

• A)$603,400
• B)$597,619
• C)$632,583
• D)$614,400

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Definitions:

Finished Goods Inventory

Items that are fully manufactured, prepared for sale, and available for customers to buy.

Work in Process Inventory

Items or materials that are partially completed in the production process, representing a company's unfinished goods.

Direct Materials

Raw materials that can be directly identified with the production of finished goods in a manufacturing process.

Direct Labor

Direct labor refers to the wages paid to workers directly involved in the production of goods or the delivery of services.