Question 1

In process cost accounting, the costs of direct materials and direct labor are charged directly to

Accepted Answer

A)  service departments 
B)  processing departments 
C)  customer accounts receivable 
D)  job orders 
A)  service departments 
B)  processing departments 
C)  customer accounts receivable 
D)  job orders

Question 2

Kramer Company started its production operations on August 1.  During August, the Printing Department completed 17,600 units.  There were 4,400 units in ending inventory which were 80% complete with respect to materials and 10% complete with respect to conversion costs.  During August, the department accumulated materials costs of $45,408 and conversion costs of $76,670. 
Required: 
(a) Calculate the cost of the goods transferred out. 
(b) What is the value of the ending inventory?

Accepted Answer

Cost per equivalent unit for materials =

Question 3

A process cost system be appropriate for a

Accepted Answer

A)  natural gas refinery 
B)  jet airplane builder 
C)  catering business 
D)  custom cabinet builder 
A)  natural gas refinery 
B)  jet airplane builder 
C)  catering business 
D)  custom cabinet builder

Question 4

Mocha Company manufactures a single product by a continuous process, involving three production departments. The records indicate that direct materials, direct labor, and applied factory overhead for Department 1 were $100,000, $125,000, and $150,000, respectively. The records further indicate that direct materials, direct labor, and applied factory overhead for Department 2 were $50,000, $60,000, and $70,000, respectively. Department 2 has transferred-in costs of $390,000 for the current period. In addition, work in process at the beginning of the period for Department 2 totaled $75,000, and work in process at the end of the period totaled $90,000. The journal entry to record the flow of costs into Department 3 during the period is

Accepted Answer

A)  Work in Process-Department 3               375,000     Work in Process-Department 2                                         375,000 
B)  Work in Process-Department 3               570,000     Work in Process-Department 2                                         570,000 
C)  Work in Process-Department 3               490,000     Work in Process-Department 2                                         490,000 
D)  Work in Process-Department 3               555,000     Work in Process-Department 2                                         555,000 
A)  Work in Process-Department 3               375,000     Work in Process-Department 2                                         375,000 
B)  Work in Process-Department 3               570,000     Work in Process-Department 2                                         570,000 
C)  Work in Process-Department 3               490,000     Work in Process-Department 2                                         490,000 
D)  Work in Process-Department 3               555,000     Work in Process-Department 2                                         555,000

Question 5

Job order manufacturing and process manufacturing are two major costing systems used in manufacturing.  Briefly contrast the characteristics of these two systems.

Accepted Answer

The answer of Job order manufacturing and process manufacturing are...

Question 6

The following unit data were assembled for the assembly process of the Super Co. for the month of April. Direct materials are added at the beginning of the process. Conversion costs are added uniformly over the production process. The company uses the FIFO method.   The number of equivalent units produced with respect to direct materials costs is

Accepted Answer

A)  48,000 
B)  49,000 
C)  43,000 
D)  53,000 
A)  48,000 
B)  49,000 
C)  43,000 
D)  53,000

Question 7

In a process costing system, the cost per equivalent unit is computed before computing equivalent units.

Accepted Answer

A) True 
 B)False

Question 8

Mocha Company manufactures a single product by a continuous process, involving three production departments. The records indicate that direct materials, direct labor, and applied factory overhead for Department 1 were $100,000, $125,000, and $150,000, respectively. The records further indicate that direct materials, direct labor, and applied factory overhead for Department 2 were $55,000, $65,000, and $80,000, respectively. In addition, work in process at the beginning of the period for Department 1 totaled $75,000, and work in process at the end of the period totaled $60,000.
The journal entry to record the flow of costs into Department 2 for direct labor is

Accepted Answer

A)  Work in Process-Department 2                   65,000     Wages Payable                                                                  65,000 
B)  Wages Payable                                             65,000     Work in Process-Department 2                                      65,000 
C)  Work in Process-Department 2                125,000     Wages Payable                                                                125,000 
D)  Work in Process-Department 2                185,000     Wages Payable                                                                 185,000 
A)  Work in Process-Department 2                   65,000     Wages Payable                                                                  65,000 
B)  Wages Payable                                             65,000     Work in Process-Department 2                                      65,000 
C)  Work in Process-Department 2                125,000     Wages Payable                                                                125,000 
D)  Work in Process-Department 2                185,000     Wages Payable                                                                 185,000

Question 9

Department R had 5,000 units in work in process that were 75% completed as to labor and overhead at the beginning of the period; 30,000 units of direct materials were added during the period; 32,000 units were completed during the period; and 3,000 units were 40% completed as to labor and overhead at the end of the period. All materials are added at the beginning of the process. The first-in, first-out method is used to cost inventories. The number of equivalent units of production for conversion costs for the period was

Accepted Answer

A)  32,450 
B)  29,450 
C)  31,950 
D)  26,000 
A)  32,450 
B)  29,450 
C)  31,950 
D)  26,000

Question 10

Department A had 5,000 units in work in process that were 60% completed as to labor and overhead at the beginning of the period; 34,000 units of direct materials were added during the period; 31,000 units were completed during the period; and 2,000 units were 80% completed as to labor and overhead at the end of the period. All materials are added at the beginning of the process. The first-in, first-out method is used to cost inventories.
The number of equivalent units of production for material costs for the period was

Accepted Answer

A)  34,000 
B)  29,800 
C)  29,000 
D)  32,000 
A)  34,000 
B)  29,800 
C)  29,000 
D)  32,000

Question 11

The debits to Work in Process-Assembly Department for April, together with data concerning production, are as follows:   All direct materials are placed in process at the beginning of the process and the average cost method is used to cost inventories.
The conversion cost per equivalent unit (to the nearest cent) for April is:

Accepted Answer

A)  $2.70 
B)  $2.53 
C)  $3.31 
D)  $5.60 
A)  $2.70 
B)  $2.53 
C)  $3.31 
D)  $5.60

Question 12

A form prepared periodically for each processing department summarizing the units for which the department is accountable and the units to be assigned costs and the costs charged to the department and the allocation of these costs is termed a

Accepted Answer

A)  factory overhead production report 
B)  manufacturing cost report 
C)  process cost report 
D)  cost of production report 
A)  factory overhead production report 
B)  manufacturing cost report 
C)  process cost report 
D)  cost of production report

Question 13

Department E had 4,000 units in Work in Process that were 40% completed at the beginning of the period at a cost of $12,500. 14,000 units of direct materials were added during the period at a cost of $28,700. 15,000 units were completed during the period, and 3,000 units were 75% completed at the end of the period. All materials are added at the beginning of the process. Direct labor was $32,450 and factory overhead was $18,710.
The number of equivalent units of production for the period for materials if the average cost method is used to cost inventories was

Accepted Answer

A)  15,650 
B)  18,000 
C)  17,250 
D)  17,700 
A)  15,650 
B)  18,000 
C)  17,250 
D)  17,700

Question 14

Department W had 2,400 units, one-third completed at the beginning of the period; 16,000 units were transferred to Department X from Department W during the period; and 1,800 units were one-half completed at the end of the period.  Assume the completion ratios apply to direct materials and conversion costs.
What is the total number of units to be assigned cost on the cost of production report for Department W?

Accepted Answer

A)  12,000 units 
B)  13,600 units 
C)  18,500 units 
D)  17,800 units 
A)  12,000 units 
B)  13,600 units 
C)  18,500 units 
D)  17,800 units

Question 15

In a process costing system, costs flow into finished goods inventory only from the work in process inventory of the last manufacturing process.

Accepted Answer

A) True 
 B)False

Question 16

Once equivalent units are calculated for materials, this number will also be used for direct labor and factory overhead.

Accepted Answer

A) True 
 B)False

Question 17

If the products of a manufacturing process are produced to customer specifications, a process cost system is more appropriate than a job order cost system.

Accepted Answer

A) True 
 B)False

Question 18

Process and job order cost systems are similar in all of the following ways except

Accepted Answer

A)  both accumulate product costs-direct materials, direct labor, and factory overhead 
B)  both allocate product cost to units produced 
C)  both maintain perpetual inventories 
D)  both use job order cost cards 
A)  both accumulate product costs-direct materials, direct labor, and factory overhead 
B)  both allocate product cost to units produced 
C)  both maintain perpetual inventories 
D)  both use job order cost cards

Question 19

Department A had 5,000 units in work in process that were 60% completed as to labor and overhead at the beginning of the period; 34,000 units of direct materials were added during the period; 31,000 units were completed during the period; and 2,000 units were 80% completed as to labor and overhead at the end of the period. All materials are added at the beginning of the process. The first-in, first-out method is used to cost inventories.
The number of equivalent units of production for conversion costs for the period was

Accepted Answer

A)  29,600 
B)  32,000 
C)  32,400 
D)  34,000 
A)  29,600 
B)  32,000 
C)  32,400 
D)  34,000

Question 20

If the costs for direct materials, direct labor, and factory overhead were $277,300, $52,600, and $61,000, respectively, for 14,000 equivalent units of production, the total conversion cost was $390,900.

Accepted Answer

A) True 
 B)False

In process cost accounting, the costs of direct materials and direct labor are charged directly to

A process cost system be appropriate for a

Job order manufacturing and process manufacturing are two major costing systems used in manufacturing. Briefly contrast the characteristics of these two systems.

In a process costing system, the cost per equivalent unit is computed before computing equivalent units.

A form prepared periodically for each processing department summarizing the units for which the department is accountable and the units to be assigned costs and the costs charged to the department and the allocation of these costs is termed a

In a process costing system, costs flow into finished goods inventory only from the work in process inventory of the last manufacturing process.

Once equivalent units are calculated for materials, this number will also be used for direct labor and factory overhead.

If the products of a manufacturing process are produced to customer specifications, a process cost system is more appropriate than a job order cost system.

Process and job order cost systems are similar in all of the following ways except

If the costs for direct materials, direct labor, and factory overhead were $277,300, $52,600, and $61,000, respectively, for 14,000 equivalent units of production, the total conversion cost was $390,900.

Introduction to Managerial Accounting

Job Order Costing

Activity Based Costing

Cost Volume Profit Analysis

Variable Costing for Management Analysis

Budgeting

Evaluating Variances From Standard Costs

Evaluating Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

Lean Manufacturing and Activity Analysis

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 3: Process Cost Systems

In process cost accounting, the costs of direct materials and direct labor are charged directly to

A process cost system be appropriate for a

Job order manufacturing and process manufacturing are two major costing systems used in manufacturing. Briefly contrast the characteristics of these two systems.

In a process costing system, the cost per equivalent unit is computed before computing equivalent units.

A form prepared periodically for each processing department summarizing the units for which the department is accountable and the units to be assigned costs and the costs charged to the department and the allocation of these costs is termed a

In a process costing system, costs flow into finished goods inventory only from the work in process inventory of the last manufacturing process.

Once equivalent units are calculated for materials, this number will also be used for direct labor and factory overhead.

If the products of a manufacturing process are produced to customer specifications, a process cost system is more appropriate than a job order cost system.

Process and job order cost systems are similar in all of the following ways except

If the costs for direct materials, direct labor, and factory overhead were $277,300, $52,600, and $61,000, respectively, for 14,000 equivalent units of production, the total conversion cost was $390,900.

Introduction to Managerial Accounting

Job Order Costing

Activity Based Costing

Cost Volume Profit Analysis

Variable Costing for Management Analysis

Budgeting

Evaluating Variances From Standard Costs

Evaluating Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

Lean Manufacturing and Activity Analysis

Statement of Cash Flows

Financial Statement Analysis

Filters