Realm Company uses process costing and had an equivalent cost of $2.30 per unit for direct materials and $1.80 per unit for conversion costs during May in its Rolling Department.There were 11,600 units completed and transferred to Finished Goods, and 1,000 units in ending Work in Process inventory that were 80% complete with respect to direct material and 60% complete with respect to conversion costs.How much is the cost of completed goods transferred to Finished Goods from the Rolling Department during May?
A)$2,920
B)$47,560
C)$50,480
D)$53,360

Question

Quizplus · Accepted Answer

The cost of completed goods transferred to Finished Goods is calculated by adding the total cost of direct materials and conversion costs for the units completed and transferred. For 11,600 units, the cost is (11,600 units * $2.30) for direct materials + (11,600 units * $1.80) for conversion costs = $26,680 + $20,880 = $47,560.

Realm Company Uses Process Costing and Had an Equivalent Cost