For the Assembly Department unit materials cost is $6 and unit conversion cost is $9. If there are 10000 units in ending work in process 75% complete as to conversion costs the costs to be assigned to the inventory are
A) $150000.
B) $127500.
C) $112500.
D) $135000.

Question

Quizplus · Accepted Answer

The total cost assigned to the inventory is calculated by adding the full materials cost for all units (since materials are usually added at the beginning of the process) and the conversion costs only for the percentage of completion. For 10,000 units, the materials cost is $6/unit, totaling $60,000. The conversion cost is $9/unit, but since the units are only 75% complete, the conversion cost is 75% of $9/unit * 10,000 units = $67,500. Adding both gives $60,000 + $67,500 = $127,500.

For the Assembly Department Unit Materials Cost Is $6 and Unit