12. Carmon Corporation uses the weighted-average method in its process costing s
ID: 2489357 • Letter: 1
Question
12.
Carmon Corporation uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 700 units. The costs and percentage completion of these units in beginning inventory were:
Cost
Percent Complete
Materials Costs
$
16,700
90%
Conversion Costs
$
9,500
60%
A total of 7,400 units were started and 6,300 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month:
Materials Costs
$
171,800
Conversion Costs
$
137,400
The ending inventory was 75% complete with respect to materials and 40% complete with respect to conversion costs.
Note: Your answers may differ from those offered below due to rounding error. In all cases, select the answer that is the closest to the answer you computed. To reduce rounding error, carry out all computations to at least three decimal places.
How many units are in ending work in process inventory in the first processing department at the end of the month?
1,000
1,800
1,100
6,700
22. Financial data for Redstone Company for last year appear below:
Redstone Company
Statements of Financial Position
Beginning
Balance
Ending
Balance
Assets:
Cash
$
308,000
$
246,245
Accounts receivable
131,000
164,000
Inventory
325,000
256,000
Plant and equipment (net)
460,000
453,000
Investment in Balsam Company
243,000
312,000
Land (undeveloped)
300,000
300,000
Total assets
$
1,767,000
$
1,731,245
Liabilities and owners’ equity:
Accounts payable
$
168,000
$
145,000
Long-term debt
809,000
809,000
Owners’ equity
790,000
777,245
Total liabilities and owners’ equity
$
1,767,000
$
1,731,245
Redstone Company
Income statement
Sales
$
1,780,000
Less operating expenses
1,450,700
Net operating income
329,300
Less interest and taxes:
Interest expense
$
93,800
Tax expense
115,255
209,055
Net income
$
120,245
The company paid dividends of $133,000 last year. The "Investment in Balsam Company" on the statement of financial position represents an investment in the stock of another company.
Required:
a.
Compute the company's margin, turnover, and return on investment for last year. (Round your intermediate calculations and final answers to 2 decimal places.)
b.
The Board of Directors of Redstone has set a minimum required return of 25%. What was the company's residual income last year? (Round your intermediate calculations and final answers to 2 decimal places.)
Carmon Corporation uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 700 units. The costs and percentage completion of these units in beginning inventory were:
Explanation / Answer
Answer:
Question 22 ) Ans: No. of units in the Ending work in process Inventory in the first processing Department
= Units in the Beginning Inventory + Units Started - Units Transferred
= 700 + 7,400 - 6,300 = 1,800 units.
Answer B.
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.