The Following Data Are Available for a Company's Manufacturing Activities

question 160

Multiple Choice

The following data are available for a company's manufacturing activities: If materials are added when the production process begins and direct labor is applied uniformly throughout the process, what are the equivalent units for direct materials and for direct labor, respectively using the FIFO method of process costing?

• A) 16,250; 19,250.
• B) 16,250; 21,750.
• C) 21,000; 19,250.
• D) 19,250; 18,750.
• E) 21,000; 22,250.

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Definitions:

Operating Assets

Assets that are used for the day-to-day operations of a business, including cash, inventory, and property, plant, and equipment.

Minimum Required Rate

The lowest acceptable rate of return on an investment demanded by an investor, considering risk factors.

Net Operating Income

The profit generated from a company's everyday operations, excluding income from investments and extraordinary items.

Operating Assets

Assets used by a business in its operational activities to generate revenue, excluding investment and non-operational assets.