In regards to budgeted-conversion costs,if some units have not been completed,managerial accountants compute the conversion-cost rate by:
A)adding budgeted conversion costs to the equivalent units of conversion costs.
B)subtracting budgeted conversion costs from the equivalent units of conversion costs.
C)multiplying budgeted conversion costs from the equivalent units of conversion costs.
D)dividing budgeted conversion costs by the equivalent units of conversion costs.
E)subtracting the budgeted conversion units by the equivalent units of conversion costs.

Question

Quizplus · Accepted Answer

To compute the conversion-cost rate for incomplete units, we need to divide the total budgeted conversion costs by the equivalent units of conversion costs. This gives us the cost per unit of converting partially completed units into finished products. Therefore, the correct choice is D, dividing budgeted conversion costs by the equivalent units of conversion costs.

In Regards to Budgeted-Conversion Costs,if Some Units Have Not Been