QUESTION 16 Richards Corporation uses the weighted-average method of process cos

Question

QUESTION 16 Richards Corporation uses the weighted-average method of process costing. The following information is available for October in its Fabricating Department: Units Beginning inventory: 80,000 units, 60% complete as to materials and 20% complete as to conversion. Units started and completed: 250,000 Units completed and transferred out: 330,000. Ending inventory: 30,000 units, 40% complete as to materials and 10% complete as to conversion. Costs: Costs in beginning Work in Process- Direct Materials: $37,200. Costs in beginning Work in Process Conversion: $79,700. Costs incurred in October Direct Materials: $646,800. Costs incurred in October - Conversion: $919,300. Calculate the equivalent units of materials. O 342,000 O 333,000 O 294,000 250,000 O 317,000

Explanation / Answer

8) Equivalent unit of material = 330000+(30000*40%) = 342000 units

so answer is a) 342000

9) Applied overhead = (150000-40000)*150% = 165000

Actual overhead = 167800

Under applied overhead = 165000-167800 = 2800

so answer is e) $2,800 underapplied

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