Question 1

The journal entry to record the application of overhead costs to production includes:

Accepted Answer

A) a credit to Manufacturing Overhead. 
B) a credit to Work in Process Inventory. 
C) a credit to Finished Goods Inventory. 
D) a credit to Cost of Goods Sold. 
A) a credit to Manufacturing Overhead. 
B) a credit to Work in Process Inventory. 
C) a credit to Finished Goods Inventory. 
D) a credit to Cost of Goods Sold.

Question 2

Crador Corp.uses a process costing system in which direct materials are added at the beginning of the process and conversion costs are incurred uniformly throughout the process.Beginning inventory for January consisted of 1,300 units.13,000 units were started into the process during January.On January 31,the inventory consisted of 650 units.Equivalent units for conversion costs were 14,235.What percentage complete was the ending inventory with respect to conversion costs on January 31 using the weighted-average method?

Accepted Answer

A) 70% 
B) 80% 
C) 90% 
D) 100% 
A) 70% 
B) 80% 
C) 90% 
D) 100%

Question 3

Computing equivalent units is especially important for:

Accepted Answer

A) goods that take a long time to produce,such as airplanes. 
B) goods that are started and completed during the same period. 
C) goods that take a relatively short time to produce,such as plastic bottles. 
D) goods with sustainability implications in their production processes. 
A) goods that take a long time to produce,such as airplanes. 
B) goods that are started and completed during the same period. 
C) goods that take a relatively short time to produce,such as plastic bottles. 
D) goods with sustainability implications in their production processes.

Question 4

Which of the following statements is incorrect regarding the production costing report?

Accepted Answer

A) A separate production report is prepared for each major production process on an annual basis. 
B) The production report provides information about the number of units and manufacturing costs that flow through a production process during an accounting period. 
C) The production report is used to determine how much manufacturing cost to transfer out of Work in Process Inventory and into the next processing department or finished goods if it is the last production process. 
D) The production report is used to value any units that are in process at the end of the accounting period. 
A) A separate production report is prepared for each major production process on an annual basis. 
B) The production report provides information about the number of units and manufacturing costs that flow through a production process during an accounting period. 
C) The production report is used to determine how much manufacturing cost to transfer out of Work in Process Inventory and into the next processing department or finished goods if it is the last production process. 
D) The production report is used to value any units that are in process at the end of the accounting period.

Question 5

To calculate cost per equivalent unit in process costing,divide total manufacturing costs by the total number of equivalent units.Under the weighted average method,what costs are reflected in total manufacturing costs?

Accepted Answer

A) Only current period costs 
B) Only prior period costs 
C) Both current and prior period costs 
D) Both current and future period costs 
A) Only current period costs 
B) Only prior period costs 
C) Both current and prior period costs 
D) Both current and future period costs

Question 6

The journal entry to record the actual (not applied)overhead costs incurred includes:

Accepted Answer

A) a debit to Manufacturing Overhead. 
B) a debit to Work in Process Inventory. 
C) a debit to Finished Goods Inventory. 
D) a debit to Cost of Goods Sold. 
A) a debit to Manufacturing Overhead. 
B) a debit to Work in Process Inventory. 
C) a debit to Finished Goods Inventory. 
D) a debit to Cost of Goods Sold.

Question 7

The journal entry to record the application of overhead costs to production includes:

Accepted Answer

A) a debit to Manufacturing Overhead. 
B) a debit to Work in Process Inventory. 
C) a debit to Finished Goods Inventory. 
D) a debit to Cost of Goods Sold. 
A) a debit to Manufacturing Overhead. 
B) a debit to Work in Process Inventory. 
C) a debit to Finished Goods Inventory. 
D) a debit to Cost of Goods Sold.

Question 8

Cost per equivalent unit is kept separate for direct materials and conversion costs because:

Accepted Answer

A) the physical units are different for the two categories. 
B) the total manufacturing costs are different for the two categories. 
C) the equivalent units are different for the two categories. 
D) the ending inventories are different for the two categories. 
A) the physical units are different for the two categories. 
B) the total manufacturing costs are different for the two categories. 
C) the equivalent units are different for the two categories. 
D) the ending inventories are different for the two categories.

Question 9

Swan Corp.began work on 4,200 units this period.Work in Process Inventory was 700 at the beginning of the period (60% complete)and 1,400 at the end of the period (50% complete).Swan uses the weighted average method of process costing.Direct materials are added at the beginning of the process,and conversion costs are incurred evenly throughout the period.
Required:
Using the weighted average method:
a.How many units were completed during the period?
b.Determine the number of equivalent units for direct materials.
c.Determine the number of equivalent units for conversion costs.

Accepted Answer

a.3,500 = 700 + 4,200 − 1,400
b.4,900 =

Question 10

How could a firm using the weighted average method of process costing calculate how many units were worked on during a period?

Accepted Answer

A) Add beginning units in inventory and units completed 
B) Add beginning units in inventory and ending units in inventory 
C) Add units completed and ending units in inventory 
D) Add units started and units completed 
A) Add beginning units in inventory and units completed 
B) Add beginning units in inventory and ending units in inventory 
C) Add units completed and ending units in inventory 
D) Add units started and units completed

Question 11

Which of the following is not a characteristic of process costing?

Accepted Answer

A) Products are homogenous. 
B) Costs are traced to production processes rather than products. 
C) Service firms cannot use process costing. 
D) Processes are standardized. 
A) Products are homogenous. 
B) Costs are traced to production processes rather than products. 
C) Service firms cannot use process costing. 
D) Processes are standardized.

Question 12

Bosco Corp.uses a process costing system.Beginning inventory for January consisted of 1,500 units that were 50% completed.During January,10,000 units were completed.On January 31,the inventory consisted of 750 units that were 75% completed.How many units were started during January?

Accepted Answer

A) 8,500 
B) 9,250 
C) 10,000 
D) 10,750 
A) 8,500 
B) 9,250 
C) 10,000 
D) 10,750

Question 13

How could a firm using the weighted average method of process costing calculate how many units were started during a period?

Accepted Answer

A) Add units completed and beginning units in inventory,then subtract ending units in inventory. 
B) Subtract beginning units in inventory from units completed,then add ending units in inventory. 
C) Add beginning units in inventory,units completed,and ending units in inventory. 
D) Subtract ending units in inventory from units completed,then add beginning units in inventory. 
A) Add units completed and beginning units in inventory,then subtract ending units in inventory. 
B) Subtract beginning units in inventory from units completed,then add ending units in inventory. 
C) Add beginning units in inventory,units completed,and ending units in inventory. 
D) Subtract ending units in inventory from units completed,then add beginning units in inventory.

Question 14

Swan Corp.began work on 3,000 units this period.Work in Process Inventory was 500 at the beginning of the period (60% complete)and 1,000 at the end of the period (50% complete).Beginning inventory costs were $3,000 for conversion costs and $7,000 for direct materials.During the period,Swan incurred $75,000 for conversion costs and $52,500 for direct materials.Swan uses the weighted average method of process costing.Direct materials are added at the beginning of the process,and conversion costs are incurred evenly throughout the period.
Required:
Using the weighted average method,compute:
a.How many units were completed during the period?
b.Determine the number of equivalent units for direct materials.
c.Determine the number of equivalent units for conversion costs.
d.Calculate the cost per equivalent unit for direct materials.
e.Determine the cost per equivalent unit for conversion costs.
f.Determine the cost assigned to ending Work in Process Inventory.
g.Determine the cost assigned to goods completed and transferred out.

Accepted Answer

a.2,500 = 500 + 3,000 − 1,000
b.3,500 =

Question 15

Which of the following statements is true?

Accepted Answer

A) A process costing system will have a single Work in Process Inventory account. 
B) A process costing system will have a separate Work in Process Inventory account for each of the major processes. 
C) A job costing system will have a separate Work in Process Inventory account for each of the major processes. 
D) A process costing system will have a separate Raw Materials Inventory account for each of the major processes. 
A) A process costing system will have a single Work in Process Inventory account. 
B) A process costing system will have a separate Work in Process Inventory account for each of the major processes. 
C) A job costing system will have a separate Work in Process Inventory account for each of the major processes. 
D) A process costing system will have a separate Raw Materials Inventory account for each of the major processes.

Question 16

Which of the following companies would most likely use process costing?

Accepted Answer

A) A soft drink company 
B) A law firm 
C) A custom garden equipment manufacturer 
D) A home remodeling company 
A) A soft drink company 
B) A law firm 
C) A custom garden equipment manufacturer 
D) A home remodeling company

Question 17

Griffin,Inc.manufactures units in two processes: Machining and Assembly.All direct materials are added at the beginning of the Machining process,while conversion costs are incurred evenly throughout the period for both Machining and Assembly.Goods completed in Machining are transferred to Assembly where they are completed and transferred to Finished Goods Inventory.Griffin's controller accumulated the following information about the units and costs incurred in the two processes for the current period:
Units:
   Costs:
   Required:
Using the weighted average method,determine the number of physical units:
a.transferred into Assembly during the period.
b.transferred from Machining to Assembly during the period.
c.started in Machining during the period.
Using the weighted average method,determine the number of equivalent units:
d.for direct materials for Machining.
e.for conversion for Machining.
f.for direct materials for Assembly.
g.for conversion for Assembly.
Using the weighted average method,determine the cost per equivalent unit (round to 5 decimals):
h.for direct materials for Assembly.
i.for conversion for Assembly.
Using the weighted average method,determine the total cost of (round to whole dollars,i.e. ,0 decimals):
j.materials in the goods transferred to Finished Goods Inventory.
k.conversion costs in the goods transferred to Finished Goods Inventory.
l.the goods transferred to Finished Goods Inventory.
m.materials in ending Work in Process Assembly.
n.conversion costs in ending Work in Process Assembly.
o.ending Work in Process Assembly.

Accepted Answer

a.18,500 = 1,500 units in Assembly endin

Question 18

To reconcile the number of physical units using the weighted average method of process costing,one must determine whether the units were:

Accepted Answer

A) in process at the beginning of the period or were completed at the beginning of the period. 
B) in process at the beginning of the current period or in process at the beginning of the previous period. 
C) in process at the beginning of the period or were sold at the beginning of the period. 
D) in process at the beginning of the period or were started during the period. 
A) in process at the beginning of the period or were completed at the beginning of the period. 
B) in process at the beginning of the current period or in process at the beginning of the previous period. 
C) in process at the beginning of the period or were sold at the beginning of the period. 
D) in process at the beginning of the period or were started during the period.

Question 19

The journal entry to record the purchase of direct materials includes:

Accepted Answer

A) a debit to Raw Materials Inventory. 
B) a debit to Finished Goods Inventory. 
C) a debit to Work in Process Inventory. 
D) a debit to Cash. 
A) a debit to Raw Materials Inventory. 
B) a debit to Finished Goods Inventory. 
C) a debit to Work in Process Inventory. 
D) a debit to Cash.

Question 20

The journal entry to record the completion of goods includes:

Accepted Answer

A) a credit to Conversion Costs. 
B) a credit to Work in Process Inventory. 
C) a credit to Finished Goods Inventory. 
D) a credit to Cost of Goods Sold. 
A) a credit to Conversion Costs. 
B) a credit to Work in Process Inventory. 
C) a credit to Finished Goods Inventory. 
D) a credit to Cost of Goods Sold.

The journal entry to record the application of overhead costs to production includes:

Computing equivalent units is especially important for:

Which of the following statements is incorrect regarding the production costing report?

To calculate cost per equivalent unit in process costing,divide total manufacturing costs by the total number of equivalent units.Under the weighted average method,what costs are reflected in total manufacturing costs?

The journal entry to record the actual (not applied)overhead costs incurred includes:

The journal entry to record the application of overhead costs to production includes:

Cost per equivalent unit is kept separate for direct materials and conversion costs because:

How could a firm using the weighted average method of process costing calculate how many units were worked on during a period?

Which of the following is not a characteristic of process costing?

Bosco Corp.uses a process costing system.Beginning inventory for January consisted of 1,500 units that were 50% completed.During January,10,000 units were completed.On January 31,the inventory consisted of 750 units that were 75% completed.How many units were started during January?

How could a firm using the weighted average method of process costing calculate how many units were started during a period?

Which of the following statements is true?

Which of the following companies would most likely use process costing?

To reconcile the number of physical units using the weighted average method of process costing,one must determine whether the units were:

The journal entry to record the purchase of direct materials includes:

The journal entry to record the completion of goods includes:

Introduction to Managerial Accounting

Job Order Costing

Activity-Based Costing and Cost Management

Cost Behavior

Cost-Volume-Profit Analysis

Incremental Analysis for Short-Term Decision Making

Budgetary Planning

Standard Costing and Variance Analysis

Decentralized Performance Evaluation

Capital Budgeting

Statement of Cash Flows

Measuring and Evaluating Financial Performance

Filters

Exam 3: Process Costing

The journal entry to record the application of overhead costs to production includes:

Computing equivalent units is especially important for:

Which of the following statements is incorrect regarding the production costing report?

To calculate cost per equivalent unit in process costing,divide total manufacturing costs by the total number of equivalent units.Under the weighted average method,what costs are reflected in total manufacturing costs?

The journal entry to record the actual (not applied)overhead costs incurred includes:

The journal entry to record the application of overhead costs to production includes:

Cost per equivalent unit is kept separate for direct materials and conversion costs because:

How could a firm using the weighted average method of process costing calculate how many units were worked on during a period?

Which of the following is not a characteristic of process costing?

Bosco Corp.uses a process costing system.Beginning inventory for January consisted of 1,500 units that were 50% completed.During January,10,000 units were completed.On January 31,the inventory consisted of 750 units that were 75% completed.How many units were started during January?

How could a firm using the weighted average method of process costing calculate how many units were started during a period?

Which of the following statements is true?

Which of the following companies would most likely use process costing?

To reconcile the number of physical units using the weighted average method of process costing,one must determine whether the units were:

The journal entry to record the purchase of direct materials includes:

The journal entry to record the completion of goods includes:

Introduction to Managerial Accounting

Job Order Costing

Activity-Based Costing and Cost Management

Cost Behavior

Cost-Volume-Profit Analysis

Incremental Analysis for Short-Term Decision Making

Budgetary Planning

Standard Costing and Variance Analysis

Decentralized Performance Evaluation

Capital Budgeting

Statement of Cash Flows

Measuring and Evaluating Financial Performance

Filters