Howell Company Uses the Average Cost Method of Process Costing

Multiple Choice

Howell Company uses the average cost method of process costing.Howell had 1,000 units in beginning work-in-process which were 75% complete.Costs associated with this inventory were $3,200.When calculating the cost per equivalent unit for the month of June,Howell's controller should:

A) Not consider the $3,200 as those costs were incurred in a prior period.
B) Calculate the cost to complete the 1,000 items in beginning work-in-process separately.
C) Include the $3,200 with the current month's cost to arrive at total cost for production to date.
D) Include the equivalent units to complete the beginning work-in-process inventory to arrive at the equivalent units for the period.