Exam 4: Process Costing and Hybrid Product-Costing Systems

The flow of costs through the manufacturing accounts is essentially the same in both process costing and job-order costing.

Operation costing might be used to determine the cost of all of the following products except:

Baxter Products manufactures office furniture by using an assembly-line process. All direct materials are introduced at the start of the process, and conversion cost is incurred evenly throughout manufacturing. An examination of the company's Work-in-Process account for August revealed the following selected information: Debit side- August 1 balance: 600 units, 40% complete; cost, $44,600* Production started: 1,800 units Direct materials used during August: $90,000 August conversion cost: $51,400 Credit side- Production completed: 1,400 units *Supplementary records disclosed direct material cost of $30,000 and conversion cost of $14,600. Conversations with manufacturing personnel revealed that the ending work in process was 80% complete. Required: A. Determine the number of units in the August 31 work-in-process inventory. B. Calculate the cost of goods completed during August, and prepare the appropriate journal entry to record completed production. C. Determine the cost of the August 31 work-in-process inventory.

What is the missing amount in this physical flow of units?

Equivalent-unit calculations are necessary to allocate manufacturing costs between units sold and ending work in process.

Use the following information to answer the following Questions Lakeland Chemical manufactures a product called Zing. Direct materials are added at the beginning of the process, and conversion activity occurs uniformly throughout production. The beginning work-in-process inventory is 60% complete with respect to conversion; the ending work-in-process inventory is 20% complete. The following data pertain to May: -Using the weighted-average method of process costing, the equivalent units of conversion activity total:

Covington Corporation uses a process-cost accounting system. The company adds direct materials at the start of its production process; conversion cost, on the other hand, is incurred evenly throughout manufacturing. The firm has no beginning work-in-process inventory; its ending work in process is 40% complete. Which of the following sets of percentages would be used to calculate the correct number of equivalent units in the ending work-in-process inventory?

Harrington Industries, which uses a process-costing system, had a balance in its Work-in-Process account of $68,000 on January 1. The account was charged with direct materials, direct labor, and manufacturing overhead of $450,000 throughout the year. If a review of the accounting records determined that $86,000 of goods were still in production at year-end, Harrington should make a journal entry on December 31 that includes: