Exam 6: Process Costing

Ramses Corporation produces a product that passes through two processes. During April, the first department transferred 19,000 units to the second department. The cost of the units transferred was $30,000. Materials are added uniformly in the second process. The following information is provided about the second department's operations during April: Units, beginning work in process 4,000 Units, ending work in process 5,500 The number of units completed in the second department during April is

Process systems are characterized by a larger number of homogeneous products passing through a series of processes.

In a process-costing system, work-in-process inventory, materials are added uniformly so that multiple calculations of equivalent units are needed for each type of input.

In process costing, costs are accounted for by

Julius Corporation's mixing department began January 2018 with 10,000 gallons of product (40 percent completed) in process. During January, Julius started 100,000 gallons of new product, of which 15,000 gallons remained in ending inventory (70 percent completed). If materials were added when the units are 50 percent complete, how many equivalent units of production for materials would there be for Julius Corporation using the FIFO costing method?

Maynard Inc. manufactures desks. The following data was given for production in February: units, beginning work in process 0 units started 200 units completed ? units, ending work in process ( 40\% complete) 50 What were the total number of units to account for?

The following information is available for Department C for the month of August: Units Cost Work in process, August 1 (70\% complete) 10,000 Direct materials \ 36,000 Direct labor 18,000 Manufacturing overhead 24,000 Total work in process, August 1 \ 78,000 Started in production during August 40,000 Costs added: Direct materials 108,000 Direct labor 48,000 Manufacturing overhead 61,040 Total costs added during August \ 217,040 Work in process, August 31 (80\% complete) 4,000 Units completed and transferred out 42,000 Materials are added at the beginning of the process. Inspection takes place at the 50 percent point in the conversion process to determine spoiled units. Round unit costs to two decimal places. The company uses the weighted average cost flow assumption. Department C's equivalent units of production for materials using the weighted average method is

In firms with ending work-in-process inventories, output is measured using equivalent units.

Twinnings Corporation manufactures Scheduling Books. There are two processes: printing and binding. The following information is given for the printing department for September. Units: Units, beginning work in process 40,000 (20\% complete for materials, $60 \%$ complete for conversion) Started Completed? Units, ending work in process $\quad 50,000 \quad$ (25\% complete for materials, $80 \%$ complete for conversion) Costs: Materials Conversion Total beginning workin process \ 6,080 \ 2,160 \ 8,240 current costs \ 220,875 \ 30,600 \ 251,475 total costs \ 226,955 \ 32,760 \ 259,715 The company uses FIFO inventory assumption. What are the FIFO equivalent units for conversion?

When spoilage is due to the exacting nature of a particular job it is called __________ spoilage.

Data related to Alpha, Inc., for the month of June follows: Units Work in process (WIP), June 1 (40\% complete) 16,000 Started in June 80,000 Work in process, June 30 24,000 Materials are added at the beginning of the process. If equivalent units of production for conversion using the weighted average method were 79,200 units, ending work in process on June 30 must have been:

Operation costing uses a blend of job-order and process-costing procedures whenever batches of dissimilar products are produced.

The complete units that could have been produced given the total amount of productive effort expended for the period under consideration are the:

Golden Ring Company produces two types of product: Large and Larger. Two work orders for two batches of the products are shown below, along with some additional cost information: Large Larger Work Order 10 Work Order 11 Direct materials (actual costs) \4 5,000 \7 5,000 Applied conversion costs: Mixing ? ? Cooking \ 12,000 \ 12,000 Bottling \ 10,000 \ 15,000 Batch size (bottles) 5,000 5,000 In the Mixing Department, conversion costs are applied on the basis of direct labor hours. Budgeted conversion costs for the department for the year were $50,000 for labor and $125,000 for overhead. Budgeted direct labor hours were 2,500. It takes three minutes to mix the ingredients needed for each bottle. Large (Work Order 10) and Larger (Work Order 11) flow through the Mixing Department first, then through the Cooking and Bottling departments. What is Golden Ring Company's unit cost of Larger?

The major benefit of the weighted average method is simplicity. The major disadvantage is that accuracy and performance measurements are impaired.

The following information is available for Department C for the month of August: Units Cost Work in process, August 1 (70\% complete) 10,000 Direct materials \ 36,000 Direct labor 18,000 Manufacturing overhead 24,000 Total work in process, August 1 \ 78,000 Started in production during August 40,000 Costs added: Direct materials 108,000 Direct labor 48,000 Manufacturing overhead 61,040 Total costs added during August \ 217,040 Work in process, August 31 (80\% complete) 4,000 Units completed and transferred out 42,000 Materials are added at the beginning of the process. Inspection takes place at the 50 percent point in the conversion process to determine spoiled units. Round unit costs to two decimal places. The company uses the weighted average cost flow assumption. Department C's cost per unit for materials using the weighted average method is

The following information is available: Units in process, November 1 (60\% converted) 2,000 units Units in process, November 30(60\% converted) 4,000 units Units started during the month 30,000 units Materials are added at the beginning of the process. How many equivalent units for conversion would there be in November using the weighted average method?

Maynard Inc. manufactures desks. The following data was given for production in February: units, beginning work in process 0 units started 200 units completed ? units, ending work in process ( 40\% complete) 50 How many units were completed?

The accounting system which accumulates production costs by process and uses a work-in-process account for each process is called __________ .

Maynard Inc. manufactures desks. The following data was given for production in February: units, beginning work in process 0 units started 200 units completed ? units, ending work in process ( 40\% complete) 50 If a total of $11,050 in production costs were incurred, how much cost is assigned to the units completed?