If ending inventory consists of 2,600 units which are 100% complete with respect

ID: 2504763 • Letter: I

Question

If ending inventory consists of 2,600 units which are 100% complete with respect to
materials and 30% complete with respect to conversion costs, the number of equivalent units for materials and for conversion costs are

2,600 and 780, respectively.

780 and 8,667, respectively.

2,600 and 8,667, respectively.

2,600 and 2,600, respectively.

Product costs

are also called manufacturing costs.

are considered an asset until the finished goods are sold.

become an expense when the goods are sold.

All of the above answers are correct.

Which of the following is an example of a manufacturing overhead cost?

Security at the manufacturing plant

Fabric used to produce shirts

Cost of shipping product to customers

The salary of the president of the company

2,600 and 780, respectively.

780 and 8,667, respectively.

2,600 and 8,667, respectively.

2,600 and 2,600, respectively.

Explanation / Answer

1] If ending inventory consists of 2,600 units which are 100% complete with respect to
materials and 30% complete with respect to conversion costs, the number of equivalent units for materials and for conversion costs are

Ans:- Equivalent units for materials = 100% of ending inventory units

= 100% of 2600

= 2600 units

Equivalent units for conversion cost = 30% of ending inventory units

= 30% of 2600

= 780 units

Threfore , the answer is Option-A:- 2,600 and 780, respectively.

2] Product costs

Ans:- Option-D:- All of the above answers are correct.

3] Which of the following is an example of a manufacturing overhead cost?

Ans:-Option-A:-Security at the manufacturing plant