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Q1 Ozdemir Corporation uses the FIFO method in its process costing system. Data concerning the first processing department for the most recent month are listed below:

Beginning work in process inventory:
Units in beginning work in process inventory		300
Materials costs	$	2,000
Conversion costs	$	700
Percent complete with respect to materials		55	%
Percent complete with respect to conversion		10	%
Units started into production during the month		5,200
Units transferred to the next department during the month		4,700
Materials costs added during the month	$	76,800
Conversion costs added during the month	$	130,800
Ending work in process inventory:
Units in ending work in process inventory		800
Percent complete with respect to materials		85	%
Percent complete with respect to conversion		70	%

What are the equivalent units for conversion costs for the month in the first processing department?

Multiple Choice

• 560

• 4,400

• 5,230

• 5,500

Q2 Bellue Inc. manufactures a single product. Variable costing net operating income was $82,800 last year and its inventory decreased by 2,500 units. Fixed manufacturing overhead cost was $4 per unit for both units in beginning and in ending inventory. What was the absorption costing net operating income last year?

Garrison 16e Rechecks 2018-06-22

Multiple Choice

• $10,000

• $72,800

• $82,800

• $85,300

Q3 Krepps Corporation produces a single product. Last year, Krepps manufactured 26,030 units and sold 20,700 units. Production costs for the year were as follows:

Direct materials	$	192,622
Direct labor	$	143,165
Variable manufacturing overhead	$	210,843
Fixed manufacturing overhead	$	494,570

Sales totaled $983,250 for the year, variable selling and administrative expenses totaled $120,060, and fixed selling and administrative expenses totaled $161,386. There was no beginning inventory. Assume that direct labor is a variable cost.

Under absorption costing, the ending inventory for the year would be valued at:

Multiple Choice

• $274,700

• $283,200

• $213,200

• $240,700

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