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3 years ago

Barnett Corporation uses the weighted-average method in its process costing system. The

Business

1 answer:

Nimfa-mama [501]3 years ago

3 0

Answer:

a. 18,000

b. $5.10

Explanation:

Calculation of the total equivalent units of production for materials

Units of Closing Work In Process (6,000× 100%) = 6,000

Units completed and transferred (12,000× 100%) = 12,000

Total = 18,000

Calculation of the total equivalent units of production for conversion

Units of Closing Work In Process (6,000 × 50%) = 3,000

Units completed and transferred (12,000× 100%) = 12,000

Total = 15,000

Calculation of Total Cost of Materials

Work in process $13,800

Costs added during May $42,000

Total $55,800

Calculation of Total Cost of Conversion

Work in process $ 3,740

Costs added during May $26,260

Total $30,000

Calculation of total cost per equivalent unit for May

Materials ($55,800/18,000) = $3.10

Conversion ( $30,000/15,000) = $2.00

Total = $5.10

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Answer:

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When a country can produce a product more efficiently (i.e maximum output using minimum resources) than that of its trade partners, it is known as that it has absolute advantage in that product. India tends to have absolute advantage in both business processes outsourcing as well as producing agricultural commodities as it is mentioned that it can produce both of these more efficiently than the United States.

However, although it has absolute advantage in both, it is still less efficient in producing agricultural commodities when compared to business process outsourcing. In other words, if it attempts to produce agricultural commodities in-house, the benefit lost from the second best alternative: business process outsourcing is high. The opportunity cost is higher when it produces agricultural commodities than it is when it does business process outsourcing. Hence, due to the law of comparative advantage, it chooses to specialize in business process outsourcing and imports agricultural commodities.

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Answer:

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