In Order to Justify the Cost of Using a Wire

question 5

Multiple Choice

In order to justify the cost of using a wire transfer instead of an EDT (electronic depository transfer) ,your company must transfer a minimum of $200,000.The EDT has a one business day availability.If the EDT availability were two business days,what is the minimum transfer amount that would justify a wire transfer?

• A)$100,000
• B)$200,000
• C)$400,000
• D)the amount cannot be calculated without more information

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Definitions:

Equivalent Unit

A measure used in cost accounting to express the amount of materials or labor in terms of the number of finished units they represent.

Process Costing

An accounting methodology used for homogeneous products, which calculates the cost of a product at various stages of production by spreading the total costs over the total units produced.

Work In Process

Refers to materials that have been partially completed in production but are not yet finished goods in manufacturing.

Cost Of Production Report

A document that details the total cost and production information for a particular period or batch in a manufacturing process.