Question 15 (3 points) Blackoil Corp. has two divisions, Refining and Production. The company's primary product is Clean Oil. Each division's costs are provided below: Refining Variable costs per litre of oil Fixed costs per litre of oil $24 $30 $4 Production: Variable costs per litre of oil SG Fixed costs per litre of oil The Production Division is able to sell the oil to other areas for $24 per litre. The Refining Division has been operating at a capacity of 80,000 litres a day, using oil from the Production Division and oil purchased from other suppliers. The Refining Division usually purchases 50,000 litres of oil, on average, from the Production Division and 30,000 litres, on average, from other suppliers at 540/itre. What is the transfer price per litre assuming the method used is 175% of variable costs? Question 16 (3 points) Craft Concept manufactures small tables in its Processing Department Direct materials are added at the initiation of the production cycle and must be bundled in single kits for each unit. Conversion costs are incurred evenly throughout the production cycle. Before inspection, some units are spoiled due to non detectable materials delecta Inspection occurs at the end of the process. Spoiled units generally constitute 5 percent of the good units. Data for December are as follows: WII Beginning inventory Dec 1 10,000 units Direct material: 100% complete Conversion costs: 75% complete Started during December 40,000 unit Completed and transferred out during month 38.100 units 8,000 units WIP ending inventory December 31 Direct material: 100% complete Conversion costs: 65% complete Konts: WIP beginning inventory: Direct materials $50.000 21 $50,000 Costs: WIP beginning inventory Direct materials Conversion costs Direct materials added during December Conversion costs added during December 30,000 100,000 140,000 What is the number of total spoiled units? 2,700 units 2,000 units 4,500 units O 1.600 units 3,600 units Question 17 (3 points) Craft Concept manufactures small tables in its Processing Department. Direct materials are added at the initiation of the production cycle and must be bundled in single kits for each unit. Conversion costs are incurred evenly throughout the production cycle. Before inspection, some units are spoiled due to non-detectable materials defects. Inspection occurs at the end of the process. Spoiled units generally constitute 5 percent of the good units. Data for December are as follows: WIP Beginning inventory Dec 1 10,000 units Direct materials: 100% complete Conversion costs: 75% complete Started during December 10,000 units Completed and transferred out during month 38,400 units 8,000 units WIP, ending inventory December 31 Direct materials: 100% complete Conversion costs: 65% complete WIP, beginning inventory: Direct materials $50,000 Conversion costs 30,000 100,000 Direct materials added during December Conversion costs added during December 140,000 What is the number of Abnormal spoiled units? 1,680 units. 1,600 units. 1,700 units. 2,000 units 1,920 units
