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

question 93

Multiple Choice

Hanson Corporation uses the weighted-average 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. 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) $24,983
• B) $33,310
• C) $41,638
• D) $27,484

---

Definitions:

Economies of Scale

The cost advantage achieved by businesses when production becomes efficient, as the scale of operation increases leading to a reduction in average costs.

Positive Economic Profits

Earnings that exceed the total costs, including both the explicit and implicit costs of a business.

Expand

To increase the scale, scope, or size of something, often used in the context of business growth or economic expansion.

Increasing-cost Industry

An industry in which production costs increase as output expands, often due to scarce resources or rising input prices.