Exam 6: Process Costing

Talamoto Co. manufactures a single product that goes through two processes — mixing and cooking. The following data pertains to the Mixing Department for September.Material P is added at the beginning of work in the Mixing Department. Material Q is also added in the Mixing Department, but not until units of product are forty percent completed with regard to conversion. Conversion costs are incurred uniformly during the process. Cost per equivalent unit for Material Q under the weighted-average method is calculated to be:

Which one of the following is one of the key steps in determining process costs?

East Bay Fisheries Inc. processes king salmon for various distributors. Two departments are involved — processing and packaging. Data relating to tons of king salmon processed in the processing department during June 2019 are provided below:Total equivalent units for materials under the FIFO method are calculated to be:

Larsen Company adds materials at the beginning of the process in Department 2.Data concerning the materials used in May production are as follows: Units Work-in-process at May 1 12,000 Started during May 32,000 Completed and transferred out during May 33,000 Normal spoilage incurred 3,000 Work-in-process at May 31 8,000 Using the weighted-average method, the equivalent units for materials are:

If a firm has 1,200 completed and transferred out units, 200 equivalent units of beginning work in process and 500 ending work-in-process equivalent units, what is the total of equivalent units of production using the weighted-average method?

O'Leary Company manufactures Product Z in a two-stage production cycle in Departments A and B.Materials are added at the beginning of the process in Department B.O'Leary uses the weighted-average method.Conversion costs for Department B were 40% complete as to the 5,000 units in the beginning work-in-process (WIP) inventory and 50% complete as to the 7,000 units in the ending work-in-process inventory.10,000 units were completed and transferred out of Department B during October.An analysis of the costs relating to work-in-process inventories and production activity in Department B for October follows: Transferred- in Costs Materials Costs Conversion Costs \ 10,000 \ 3,000 \ 1,000 24,000 5,500 4,400 The total cost per equivalent unit transferred-out for October of Product Z, rounded to the nearest penny, was:

When using the first-in, first-out method of process costing, equivalent units for work done during this period is equal to the number of units:

Stoltenberg Co. had the following information for the month of June: Work in process beginning inventory, June 1 2,000 units Units transferred in 16,000 units Work in process ending inventory, June 30 4,000 units Beginning work-in-process inventory is 30 percent complete as to conversion. Ending work-in-process inventory is 50 percent complete as to conversion. Materials are added at the end of the process. How many units were started and completed in June?

DowntonTractor Company manufactures small tractors on an assembly-line basis.The units are started in Department Y.On January 1 of this year, the Work-in-Process inventory of Department Y consisted of 200 units 100% complete as to materials and 20% complete as to conversion.During the month, 800 units were started and 500 units were completed and transferred out.The Work-in-Process on January 31 was 100% complete as to materials and 20% complete as to conversion. Costs in process at the beginning of the period amounted to $100,000 for materials and $25,000 for conversion.Costs added during the period were materials costs of $200,000 and conversion costs of $143,000. Required: Prepare a production cost report using the weighted-average method.

JIT (Just in time) methods are designed primarily to:

Matrix Inc. calculates cost for an equivalent unit of production using the weighted-average method.Total equivalent units for materials under the weighted-average method are calculated to be:

Which equation correctly calculates the total weighted average equivalent units of production?

Irvine Company uses process costing.The following data are available for the month of June. (a) Materials purchased, $800,000. (b) Materials used: Direct materials: Department A $250,000, Department B $230,000.Indirect materials: $20,000. (c) Factory payroll incurred, $600,000: Direct labor: Department A $300,000, Department B $200,000.Indirect labor: $100,000. (d) Other factory overhead incurred, $30,000: Power and light $2,000, Depreciation $20,000, Property tax $5,000, Insurance $3,000. (e) Factory overhead cost was allocated equally to Department A and DepartmentB. (f) Department A completed and transferred to department B $600,000. (g) Department B completed and transferred to Finished Goods Inventory account $1,000,000. Required: (1) Prepare journal entries for June activities in Irvine Company. (2) Compute ending working-in-process inventories in Department A and Department

Reichhold Chemical Company uses process costing together with:

Talamoto Co. manufactures a single product that goes through two processes — mixing and cooking. The following data pertains to the Mixing Department for September.Total equivalent units for Material Q under the weighted-average method are calculated to be:

Giddings Pharmaceutical Company is a maker of drugs for high blood pressure and uses a process costing system. The following information pertains to the final department of Giddings's blockbuster drug called Solcax. Beginning work-in-process (40\% completed) 800 units Transferred-in 4,000 units Normal spoilage 400 units Abnormal spoilage 200 units Good units transferred out 3,600 units Ending work-in-process (1/3 completed) 600 units Conversion costs in beginning inventory \ 2,560 Current conversion costs \ 6,900 Giddings calculates separate costs of spoilage by computing both normal and abnormal spoiled units. Normal spoilage costs are reallocated to good units and abnormal spoilage costs are charged as a loss. The units of Solcax that are spoiled are the result of defects not discovered before inspection of finished units. Materials are added at the beginning of the process. Using the weighted-average method, answer the following question: What are the total conversion costs of abnormal spoilage?

Universal Automotive Group is a maker of engines for high performance cars and uses a process costing system. The following information pertains to the final department of manufacturing for Universal's most popular engine, the "Atomic 8". Beginning work-in-process ( 40\% completed) 400 units Transferred-in 1,600 units Normal spoilage 100 units Abnormal spoilage 100 units Good units transferred out 1,400 units Ending work-in-process (25\% completed) 400 units Conversion costs in beginning inventory \ 180,500 Current conversion costs \ 728,218 Universal Automotive Group calculates separate costs of spoilage by computing both normal and abnormal spoiled units. Normal spoilage costs are reallocated to good units and abnormal spoilage costs are charged as a loss. The units of the Atomic 8 that are spoiled are the result of defects not discovered before inspection of finished units. Using the weighted-average method, answer the following question: What are the equivalent units for conversion costs?

Landry Co. had the following information for the month of December. All direct materials were one hundred percent complete, and beginning materials cost $14,000.Total equivalent units for conversion under the FIFO method are calculated to be:

Universal Automotive Group is a maker of engines for high performance cars and uses a process costing system. The following information pertains to the final department of manufacturing for Universal's most popular engine, the "Atomic 8". Beginning work-in-process ( 40\% completed) 400 units Transferred-in 1,600 units Normal spoilage 100 units Abnormal spoilage 100 units Good units transferred out 1,400 units Ending work-in-process (25\% completed) 400 units Conversion costs in beginning inventory \ 180,500 Current conversion costs \ 728,218 Universal Automotive Group calculates separate costs of spoilage by computing both normal and abnormal spoiled units. Normal spoilage costs are reallocated to good units and abnormal spoilage costs are charged as a loss. The units of the Atomic 8 that are spoiled are the result of defects not discovered before inspection of finished units. Using the weighted-average method, answer the following question: What are the total conversion costs transferred to finished goods?

Process cost systems are used in all of the following industries except: