Answer the following questions using the information below:
Dharma Plastics, Inc., manufactures plastic moldings for car seats. Its costing system utilizes two cost categories, direct materials and conversion costs. Each product must pass through Department A and Department B. Direct materials are added at the beginning of production. Conversion costs are allocated evenly throughout production.

-What is the unit cost per equivalent unit of beginning inventory in Department A?
A) $2,000
B) $7,000
C) $3,500
D) $7,500

Question

Answer the following questions using the information below:
Dharma Plastics, Inc., manufactures plastic moldings for car seats. Its costing system utilizes two cost categories, direct materials and conversion costs. Each product must pass through Department A and Department B. Direct materials are added at the beginning of production. Conversion costs are allocated evenly throughout production.
 
-What is the unit cost per equivalent unit of beginning inventory in Department A?
A) $2,000 
B) $7,000 
C) $3,500 
D) $7,500

Quizplus · Accepted Answer

The unit cost per equivalent unit of beginning inventory is calculated by dividing the total cost of beginning inventory by the equivalent units in beginning inventory. The correct calculation leads to $3,500.

Answer the Following Questions Using the Information Below