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Williams Company computed its cost per equivalent unit for direct materials to be $2.60 and its cost per equivalent unit for conversion to be $3.75. A total of 250,000 units of product were completed and transferred out as finished goods during the month, and 36,000 of equivalent units remained unfinished at the end of the month. The amount that should be reported in ending Work in Process Inventory is:

A. $93,600.
B. $135,000.
C. $1,816,100.
D. $1,587,500.
E. $228,600.

Respuesta :

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Answer:

The answer is E.$228,600.

Explanation:

Please find the below for detailed explanations and calculations:

The amount of each Work in Process Inventory will be equal to:

Cost per equivalent unit for direct materials + Cost per equivalent unit for conversion = 2.60 + 3.75 = $6.35.

The amount of total 36,000 ending equivalent units Work in Process Inventory should be reported, is calculated as:

The amount of each Work in Process Inventory x Amount of ending equivalent units Work in Process Inventory = 6.35 * 36,000 = $228,000.

So, the answer is E.$228,600.

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