Natraj Corporation uses the weighted-average method in its process costing system. Operating data for the Lubricating Department
for the month of October appear below:Units % Complete for ConversionBeginning WIP Inventory 5,400 20%Transfers In during October 38,100 Completed / Transferred Out in October 37,800 Ending WIP Inventory 60%What were the equivalent units for conversion costs in the Lubricating Department in October?
1 answer:
Answer: $41,520
Explanation;
Equivalent units of production are used when some goods have not been fully processed but costs need to be attached to them. The incomplete ones will be converted to complete goods depending on how far along the production process they are.
Equivalent units for conversion costs = Transfers out during October + Ending WIP * Percentage completion
= 37,800 + (5,700 * 60%)
= $41,520
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Answer:
$280,950
Explanation:
As for the information given:
Closing balance of investment on 31 December 2015 = $440,000
Now the following adjustments need to be made to calculate the balance as on 1 August 2016
Add: Share of income from Jan to Jul 2016 = $4,000 7 months
20% = $5,600
Less: Dividend Received = $20,000 20% = $4,000
Less: Amortization of patent = $6,000/12 7 = $3,500
= $440,000 - $1,900 = $438,100
Since Jabiru sold half of its investment, thus, value of its half of the investment shall be:
$438,100/2 = $219,050
Sale value = $500,000
Thus, gain amount = $500,000 - $219,050 = $280,950