Exam 5: Process Costing

When units are moved from one processing department to the next, the cost associated with those units must also be moved from one WIP account to the next. What are these costs called?

What does direct labor costs plus manufacturing overhead equal?

Which of the following is unique to a process costing system?

In a process system with multiple processes, the cost of units completed in department one is transferred to

In process costing, there is only one Work in Process Inventory account for all of the individual processing departments.

Equivalent units should be computed separately for direct materials and conversion costs.

There are 35,000 units started. 25,600 were completed and transferred out and the 9,400 remaining units were 65% complete for conversion costs. The total number of equivalent units for conversion costs is

The "total physical units accounted for" is the sum of the units completed and transferred out during the period plus the units in ending WIP inventory.

Equivalent units express the amount of work done during a period of time in terms of fully completed units of output.

If a company has ending work in process inventory it must use the 5-step process costing procedure to determine the cost of making one unit.

A separate work in process inventory account is maintained for each process.

A pizza company produces frozen pizzas in three departments: assembly, freezing, and packaging. In assembly, crust ingredients are added at the beginning of the process. After the crust is made, the sauce, cheese, and toppings are added at the end of the process. Conversion costs are added evenly. Data for the assembly department includes: The cost per equivalent unit for conversion costs would be closest to

If all direct materials are added at the beginning of the production process, and the units have made it 50% of the way through the production process, then the percentage completion for direct materials is 100%.

Direct materials are added at the beginning of the process and conversions costs are uniformly applied. Other details include: Required: a. What are the total equivalent units for direct materials? b. What are the total equivalent units for conversion costs? c. What is the cost per equivalent unit for direct materials? d. What is the cost per equivalent unit for conversion costs? e. What is the total cost of units completed and transferred out? f. What is the total cost of units remaining in ending WIP?

The following information is provided by Arrow Company: The units in ending WIP inventory were 80% complete for materials and 40% complete for conversion costs. What are the total equivalent units for direct materials?

The document many process costing companies use to summarize the entire five-step process on one schedule is called the

Companies that use automated production processes often condense the three manufacturing costs into two categories: Direct labor and Conversion costs.

When calculating equivalent units in a second or later processing department, all physical units should be considered 100% complete with respect to transferred-in work and costs.

Brambles Corporation has two sequential processing departments: Assembly then Shaping. The Shaping Department reports the following information. Conversion costs are applied evenly throughout the process. What is the total number of equivalent units for conversion costs?

When units are sold, Finished Goods Inventory is credited.