Asked by Vaden Mangler on May 21, 2024
Verified
In April, one of the processing departments at Terada Corporation had beginning work in process inventory of $21,000 and ending work in process inventory of $27,000. During the month, $244,000 of costs were added to production and the cost of units transferred out from the department was $238,000. In the department's cost reconciliation report for April, the total cost to be accounted for under the weighted-average method would be:
A) $48,000
B) $265,000
C) $530,000
D) $509,000
Cost Reconciliation
The process of verifying and reconciling the total cost incurred against the costs accounted for in a specific period.
Weighted-Average Method
an inventory costing method that assigns a cost to inventory and to the goods sold based on the average cost of all similar items available during a certain period.
Work in Process Inventory
The value of raw materials, labor, and overhead costs for products that are partially completed but not yet ready for sale.
- Determine the total cost to be accounted for under the weighted-average method.
Verified Answer
TL
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Final Answer :
B
Explanation :
Using the weighted-average method, the cost to be accounted for is the sum of the beginning inventory, costs added during the period, minus the ending inventory.
Cost to be accounted for = Beginning inventory + Costs added – Ending inventory
Cost to be accounted for = $21,000 + $244,000 - $27,000
Cost to be accounted for = $238,000 + $244,000
Cost to be accounted for = $482,000
Therefore, the correct answer is B) $265,000.
Cost to be accounted for = Beginning inventory + Costs added – Ending inventory
Cost to be accounted for = $21,000 + $244,000 - $27,000
Cost to be accounted for = $238,000 + $244,000
Cost to be accounted for = $482,000
Therefore, the correct answer is B) $265,000.
Learning Objectives
- Determine the total cost to be accounted for under the weighted-average method.