The answer is \"B\" How?? ABC Corporation uses the weighted-average method in it

Question

The answer is "B" How??

ABC Corporation uses the weighted-average method in its process costing system. The Molding Department is the first department in its production process. The data below summarize the department's operations in January. The accounting records indicate that the conversion cost that had been assigned to beginning work in process inventory was $36,000 and a total of $411,900 in conversion costs were incurred in the department during January. Units 5,100 59,000 Percent Complete with Respect to Conversion 70% Beginning work in process inventory Units started during January ding work in process invento etost pef equValet unit for conversion costs for January in tie Molding Department is: A) $7.00 B) $7.50 C) $7.65 D) $8.00

Explanation / Answer

Units Percentage of Completion Costs Opening WIP 5100 70% 36000 Units Started 59000 411900 Ending Units 7300 40% Transferred Out units 56800 Note: Weighted Av Method is used Rules Under Weighted Average Method: 1 The W. Average Method also merge the prior period costs with current period cost by adding manufacturing cost in the beginning WIP to manufacturing cost incurred during the period 2 Equivalent Units are equal to: Units completed & transferred out plus equivalent units of Ending WIP Calculation of Equivalent Units: Units Completed & Transferred Out 56800 (Opening + Added-Closing) Equivalent Closing WIP 2920 (Ending Units*POC) Total E Units 59720 Total Cost 447900 (Opening WIP+Incurred During the Month) Total Equivalent Units 59720 Equiavlent Cost PU 7.50

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