Cosby uses a weighted-average process-costing system. All materials are added at
ID: 2413607 • Letter: C
Question
Cosby uses a weighted-average process-costing system. All materials are added at the beginning of the process; conversion costs are incurred evenly throughout production. The company finished 40,000 units during the period and had 15,000 units in progress at year-end, the latter at the 40% stage of completion. Total material costs amounted to $220,000; conversion costs were $414,000. The cost of goods completed is: $312,000. $414,000. $520,000. $634,000. some other amount.
Only answer for The cost of goods:
Explanation / Answer
Equivalent unit of material = 40000+15000 = 55000 units
Equivalent unit of conversion cost = 40000+(15000*40%) = 46000 Units
Cost per equivalent unit of material = 220000/55000 = 4 per unit
Cost per equivalent unit of conversion = 414000/46000 = 9 per unit
Cost of goods completed = (9+4)*40000 = 520000
So answer is c) $520000