Dreamtime Manufacturing Uses the Weighted-Average Method of Computing Equivalent Units

question 65

Multiple Choice

Dreamtime Manufacturing uses the weighted-average method of computing equivalent units of production. For beginning work in process there were 6000 units 30% complete as to materials and conversion costs. For ending work in process there were 4000 units 60% complete as to materials and conversion costs. 16 000 units were completed during the year. Determine the equivalent units of production.

• A) 16 000
• B) 18 400
• C) 20 000
• D) 22 600

---

Definitions:

LIFO

"Last In, First Out," an inventory valuation method where the most recently produced or purchased items are the first to be expensed.

Absorption Costing

A costing method where all manufacturing costs including both direct costs like labor and materials and indirect costs like overhead are allocated to the product.

Variable Costing

An accounting method that only considers variable costs in the calculation of product or service costs, excluding fixed costs.

Net Operating Income

The profit a company makes from its regular business operations, excluding non-operating income and expenses.