Accounts Payable Control ible Control Credit: Cash 14) Stefan Ceramics is in the

Question

Accounts Payable Control ible Control Credit: Cash 14) Stefan Ceramics is in the business of selling ceramic vass finishing. Molding department purchases Vases are molding and gsten carbide and produces ceramic vases out of it. Ceramic which designs it as per the requirement of the It has two departments- then transferred to finishing od During the month of July, molding department purchased 70xe 3800 vases dauring and other started manufacture of 4200 vases and completed and vases in the process at the end of the month. It incurred direct labor charges manufacturing costs of $600, which costs of carbide at the end of the month. It also had no beginning inventory 40% complete in respect of conversion costs. What is the total conversion A) $3000 B) $2300 C) $1600 D) $1700 purchased 720 kgs of tungsten carbide at $280 per kg. It of $1700 and other ncluded electricity costs of $700. Stefan had no inventory of tungsten of vases. The ending inventory was costs for the month of July? the month of ) 15) Stefan Ceramics is in the business of selling ceramic vases. It has two departments -molding and finishing. Molding department purchases tungsten carbide and produces ceramic vases out of it. Ceramic Vases are then transferred to finishing department, which designs it as per the requirement of the customers. During the month of July, molding department purchased 720 kgs of tungsten carbide at $280 per kg. It started manufacture of 4200 vases and completed and transferred 3200 vases during the month. It has 1000 vases in the process at the end of the month. It incurred direct labor charges of $1900 and other manufacturing costs of $500, which included electricity costs of $900. Stefan had no inventory of tungsten carbide at the end of the month. It also had no beginning inventory of vases. The ending inventory was lete in respect of conversion costs. What is the cost of tungsten carbide that will be assigned to vases finished and transferred to the finishing department for the month of A) $201,600 B) $156,900 C) $189,280 D) $153,600 July? Page 5 of 13

Explanation / Answer

Q14. Answer is A. $ 3000. Explanation: Conversion cost for the period: Labour cost 1700 Electricity cost 700 Other manufacturing cost 600 Total conversion cost 3000 Q15. Answer is D. $ 153600 Explanation: Total eq units of material cost: 4200 Total Tungsten Carbide cost 201600 Material cost per unit 48 (201600 /4200 units) Material cost assigned to Finished goods of 3200 units 153600 (3200 units @ 48)

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