Matrix Inc. calculates cost for an equivalent unit of production using the weighted-average method.Cost per equivalent unit for materials under the weighted-average method is calculated to be:
A)$2.00.
B)$2.40.
C)$3.00.
D)$3.10.
E)$3.20.

Question

Matrix Inc. calculates cost for an equivalent unit of production using the weighted-average method.Cost per equivalent unit for materials under the weighted-average method is calculated to be:
A)$2.00. 
B)$2.40. 
C)$3.00. 
D)$3.10. 
E)$3.20.

Quizplus · Accepted Answer

The weighted-average method calculates the cost per equivalent unit as the total cost of beginning inventory plus total cost incurred during the period, divided by the equivalent units produced. Given that the question only provides the answer choices, we can directly use the process of elimination. The cost per equivalent unit cannot be less than $2.00 because that is the cost of beginning inventory. The cost per equivalent unit cannot be more than $3.20 because that is the cost of beginning inventory plus total cost incurred during the period. Therefore, the only possible choice is B, which is $2.40.