If the work-in-process inventory cost incurred is $350000 and completed equivalent units to date total 3500, the weighted average cost is __________?
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Answer: B. $100
Explanation
Dividing total work-in-process cost by completed equivalent units yields average cost. The calculation correctly distributes cumulative production costs across equivalent units. The resulting hundred dollars represents the exact weighted average cost per unit. Weighted average costing combines costs from beginning inventory and current periods. Equivalent units measure partially completed production in terms of fully complete units. Process costing systems rely heavily on accurate equivalent unit calculations.
Manufacturing companies use weighted average costing for continuous production lines. Cost accountants report unit costs to management for inventory valuation purposes. Tracking equivalent units ensures fair cost assignment across completed and ending goods. Option A underestimates the correct unit cost derived from the division. Option C overstates the average cost through a decimal placement error. Option D represents an arbitrary value unrelated to the primary data.
- Subject
- Accounting and Finance
- Category
- Accounting
- Topic
- —
- Difficulty
- medium
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Answer: B. $1.5 per unit
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