Zuniga Ltd uses a process costing system. During May, 1,200 units were transferred into Department 2 at a cost of $38,040. Direct materials are added at the beginning of the process. Additionally: Using the weighted average method, the cost of the units transferred out was
A) $53,570
B) $44,710
C) $52,261
D) $66,219

Question

Quizplus · Accepted Answer

The weighted average method assigns the total cost of production to the units produced during the period. In this case, the total cost of production is $38,040 + $15,530 = $53,570. The cost per unit is $53,570 / 1,200 units = $44.64. The cost of the units transferred out is $44.64 x 1,200 units = $53,570.

Zuniga Ltd Uses a Process Costing System