A Company Uses the Weighted-Average Method for Inventory Costing

question 136

Multiple Choice

A company uses the weighted-average method for inventory costing. At the end of the period, 22,000 units were in the ending goods in process inventory and are 100% complete for materials and 75% complete for labor and overhead. The equivalent costs per unit are; materials, $2.65, labor, $2.15, and overhead, $3.20. Compute the cost that would be assigned to the ending goods in process inventory for the period.

• A) $146,575.
• B) $176,000.
• C) $87,725.
• D) $93,775.
• E) $132,000.

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Definitions:

Expenses

The outflow of money to pay for goods or services, an essential component of a company's operations.

Cash Basis

An accounting method where revenues and expenses are recognized only when cash is received or paid, as opposed to the accrual basis.

Revenue Recognition

The accounting principle that governs the conditions under which revenue is recognized in the financial statements, ensuring it is recorded when earned.

Payment

It is the transfer of money or goods from one party to another as a settlement of an obligation.