Abis Corporation Uses the Weighted-Average Method in Its Process Costing

question 28

Multiple Choice

Abis Corporation uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 800 units. The costs and percentage completion of these units in beginning inventory were: A total of 9,200 units were started and 8,200 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month: The ending inventory was 80% complete with respect to materials and 20% 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 of ending work in process inventory in the first processing department according to the company's cost system is closest to:

• A) $73,829
• B) $18,457
• C) $92,286
• D) $31,891

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Definitions:

Balance Sheet

A balance sheet is a financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time, providing a snapshot of its financial condition.

Accrued Interest

Interest accumulated but not yet paid.

Investment in Bonds

A financial strategy involving the purchase of bond securities, aiming to earn interest income and potentially benefit from bond value appreciation.

Bonds

Fixed-income investment products that represent loans made by an investor to a borrower, typically corporate or governmental, which is obligated to pay back with interest.