James Automotive Group is a maker of engines for high performance cars and uses a process costing system.The following information pertains to the final department of James' outstanding engine called "Superior-1".
James calculates separate costs of spoilage by computing both normal and abnormal spoiled units.Normal spoilage costs are reallocated to good units and abnormal spoilage costs are charged as a loss.The units of "Superior-1" that are spoiled are the result of defects not discovered before inspection of finished units.Using the weighted-average method,what are the unit conversion costs?
A)$46.70.
B)$363.64.
C)$450.00.
D)$536.36. ($180,500 + $760,000)/2,090 = $450

Question

James Automotive Group is a maker of engines for high performance cars and uses a process costing system.The following information pertains to the final department of James' outstanding engine called "Superior-1". 
James calculates separate costs of spoilage by computing both normal and abnormal spoiled units.Normal spoilage costs are reallocated to good units and abnormal spoilage costs are charged as a loss.The units of "Superior-1" that are spoiled are the result of defects not discovered before inspection of finished units.Using the weighted-average method,what are the unit conversion costs?
A)$46.70. 
B)$363.64. 
C)$450.00. 
D)$536.36. ($180,500 + $760,000)/2,090 = $450

Quizplus · Accepted Answer

The unit conversion costs are calculated by dividing the total conversion cost for the final department by the total units completed, using the weighted-average method.

Total conversion costs for the final department = $180,500 + $760,000 = $940,500
Total units completed for the final department = 2,090

Unit conversion costs = $940,500/2,090 = $450 per unit.

Therefore, the best choice is C.

James Automotive Group Is a Maker of Engines for High