23. (Grade: 3.0 points-Suggested Time: 3.0 minutes) In the most recent accountin

Question

23. (Grade: 3.0 points-Suggested Time: 3.0 minutes) In the most recent accounting period records indicated that conversion cost in opening work in process was $15,000 and that there were 5,000 units in opening work in process. During the period 120,000 units were entered into production and conversion costs of $120,000 were incurred. At the end of the period there were 10,000 units in ending work in process that were 80% completed with respect to conversion cost. The conversion cost per equivalent unit this period was which of the following? a. b. c. d. $1.000 exactly $1.080 exactly $1.100 exactly None of the above

Explanation / Answer

NONE OF THE ABOVE

5000 Units in opening work in process and 120000 units were introduced = 125000 units in total were processed but there are only 10000 units still in process at the end. This means that 115000 Units were completed and transferred out.

Total conversion cost = 15000 + 120,000 = 135000

Equivalent units = 115000 + 10000 * 80% = 123000

Cost per EUP = 135000 / 123000 = 1.0975 .... is not matching with any of the options

So select .............Option - D None of the above

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