Question 1

The cost of the company's ending work-in-process inventory is:

Accepted Answer

A) $26,640. 
B) $44,400. 
C) $56,400. 
D) $74,000. 
E) some other amount. 
A) $26,640. 
B) $44,400. 
C) $56,400. 
D) $74,000. 
E) some other amount. C

Question 2

The cost of the ending work in process is:

Accepted Answer

A) $54,000. 
B) $78,000. 
C) $114,000. 
D) $195,000. 
E) some other amount. 
A) $54,000. 
B) $78,000. 
C) $114,000. 
D) $195,000. 
E) some other amount. C

Question 3

Which of the following best describes the procedures used in operation costing to assign direct-material and conversion costs to production?

Accepted Answer

A) Choice A 
B) Choice B 
C) Choice C 
D) Choice D 
E) Choice E 
A) Choice A 
B) Choice B 
C) Choice C 
D) Choice D 
E) Choice E B

Question 4

Equivalent-unit calculations are necessary to allocate manufacturing costs between:

Accepted Answer

A) units completed and ending work in process. 
B) beginning work in process and units completed. 
C) units sold and ending work in process. 
D) cost of goods manufactured and beginning work in process. 
E) cost of goods manufactured and cost of goods sold. 
A) units completed and ending work in process. 
B) beginning work in process and units completed. 
C) units sold and ending work in process. 
D) cost of goods manufactured and beginning work in process. 
E) cost of goods manufactured and cost of goods sold.

Question 5

Which of the following are needed under weighted-average process costing to calculate the cost of goods completed during the period?

Accepted Answer

A) Choice A 
B) Choice B 
C) Choice C 
D) Choice D 
E) Choice E 
A) Choice A 
B) Choice B 
C) Choice C 
D) Choice D 
E) Choice E

Question 6

Operation costing:

Accepted Answer

A) tends to parallel job-order costing with respect to the treatment of conversion cost. 
B) tends to parallel process costing with respect to the treatment of conversion cost. 
C) tends to parallel process costing with respect to the treatment of direct materials. 
D) would likely be used by a manufacturing plant that produces one model of a single product. 
E) is commonly known as a joint-costing system. 
A) tends to parallel job-order costing with respect to the treatment of conversion cost. 
B) tends to parallel process costing with respect to the treatment of conversion cost. 
C) tends to parallel process costing with respect to the treatment of direct materials. 
D) would likely be used by a manufacturing plant that produces one model of a single product. 
E) is commonly known as a joint-costing system.

Question 7

Which of the following is a key document in a typical process-costing system?

Accepted Answer

A) Departmental production report. 
B) Master schedule. 
C) Production budget. 
D) Sequential product report. 
E) Materials requirement report. 
A) Departmental production report. 
B) Master schedule. 
C) Production budget. 
D) Sequential product report. 
E) Materials requirement report.

Question 8

Operation costing is a hybrid type of accounting system that combines features of job-order and process-cost accounting.
Required:
A.Briefly discuss the similarities and differences of an operation-costing system and a job-order cost system.
A.Similarities: Materials are unique to the individual batches or products being produced in both systems.The cost,therefore,is assigned by batch as in job costing.Differences: Processing and the incurrence of conversion costs is the same for each batch in operation costing.In job costing the different batches of product incur different processing steps.
B.Briefly discuss the similarities and differences of an operation-costing system and a process-cost system.
B.Similarities: Batches of products go through essentially the same manufacturing processes in both systems.Conversion costs can be assigned in a manner similar to that used in process-costing systems.Differences: Each batch of product in an operation-costing system uses different direct materials.In a process system,the direct materials are the same.

Accepted Answer

A.Similarities:Materials are unique to t

Question 9

All of the following statements about an operation-costing system are true except:

Accepted Answer

A) direct material and conversion costs are traced to each batch of product produced. 
B) direct-material cost is traced to each batch produced. 
C) conversion costs are applied to products on a departmental basis using a predetermined application rate. 
D) batches of product pass sequentially through the same processes. 
E) conversion activities are similar across product lines but direct materials differ significantly. 
A) direct material and conversion costs are traced to each batch of product produced. 
B) direct-material cost is traced to each batch produced. 
C) conversion costs are applied to products on a departmental basis using a predetermined application rate. 
D) batches of product pass sequentially through the same processes. 
E) conversion activities are similar across product lines but direct materials differ significantly.

Question 10

Kendra Corporation uses a process-cost accounting system.The company adds direct materials and direct labor at the start of its production process;overhead cost 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?

Accepted Answer

A) Materials,100%;labor,100%;overhead cost,40%. 
B) Materials,100%;labor,100%;overhead cost,100%. 
C) Materials,100%;labor 40%;overhead cost,40%. 
D) Materials,40%;labor,40%;overhead cost,60%. 
E) Materials,40%;labor,40%;overhead cost,100%. 
A) Materials,100%;labor,100%;overhead cost,40%. 
B) Materials,100%;labor,100%;overhead cost,100%. 
C) Materials,100%;labor 40%;overhead cost,40%. 
D) Materials,40%;labor,40%;overhead cost,60%. 
E) Materials,40%;labor,40%;overhead cost,100%.

Question 11

Yes! Co. ,had 3,000 units of work in process on April 1 that were 60% complete.During April,11,000 units were started and as of April 30,4,000 units that were 40% complete remained in production.How many units were completed during April?

Accepted Answer

A) 10,000. 
B) 9,800. 
C) 11,000. 
D) 12,200. 
E) None of thesE. 
A) 10,000. 
B) 9,800. 
C) 11,000. 
D) 12,200. 
E) None of thesE.

Question 12

The cost of goods completed is:

Accepted Answer

A) $312,000. 
B) $414,000. 
C) $520,000. 
D) $634,000. 
E) some other amount. 
A) $312,000. 
B) $414,000. 
C) $520,000. 
D) $634,000. 
E) some other amount.

Question 13

Companies that use a process-cost accounting system would:

Accepted Answer

A) establish a separate Work-in-Process Inventory account for each manufacturing department. 
B) establish a separate Finished-Goods Inventory account for each manufacturing department. 
C) pass completed production directly to Cost of Goods Sold. 
D) charge goods produced with actual overhead amounts rather than applied overhead amounts. 
E) eliminate the need for the Finished-Goods Inventory account. 
A) establish a separate Work-in-Process Inventory account for each manufacturing department. 
B) establish a separate Finished-Goods Inventory account for each manufacturing department. 
C) pass completed production directly to Cost of Goods Sold. 
D) charge goods produced with actual overhead amounts rather than applied overhead amounts. 
E) eliminate the need for the Finished-Goods Inventory account.

Question 14

Barnett,Inc. ,which uses a process-costing system,transfers completed production from Department no.1 to Department no.2 for further work.Which of the following best describes the account that would be credited to record this transfer?

Accepted Answer

A) Cost of Goods Transferred. 
B) Finished-Goods Inventory: Department no.1. 
C) Finished-Goods Inventory: Department no.2. 
D) Work-in-Process Inventory: Department no.1. 
E) Work-in-Process Inventory: Department no.2. 
A) Cost of Goods Transferred. 
B) Finished-Goods Inventory: Department no.1. 
C) Finished-Goods Inventory: Department no.2. 
D) Work-in-Process Inventory: Department no.1. 
E) Work-in-Process Inventory: Department no.2.

Question 15

Operation costing tends to parallel job-order costing with respect to the treatment of conversion cost.

Accepted Answer

A) True 
 B)False

Question 16

Professor Jones is concerned that her students do not understand the concept of equivalent units.She has therefore prepared the following questions,to appear on an upcoming examination:
Equivalent units are used in a process-costing accounting system.
A.Equivalent units are needed as a measure of production volume.At the end of the period,manufacturing costs must be spread over the units produced,and it is incorrect to combine fully completed units with those that are still in production (akin to adding apples and oranges).Separate totals are needed because materials are often introduced at specific points in production whereas conversion is often introduced uniformly throughout manufacturing.
A.Explain the need for equivalent units and why separate equivalent-unit totals are calculated for direct materials and conversion cost.
B.If an examination of goods in production at the end of the period revealed 12,000 units that are,on average,75% complete,would it be correct to say that 9,000 units were finished during the period? Why?
Required:
Prepare a complete answer key that can be used in grading the examination questions.
B.No.The units are still in production,so none of them are fully completeD.It would be correct to say that the firm has done the work equivalent to manufacturing 9,000 finished units.

Accepted Answer

A.Equivalent units are needed as a measu

Question 17

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

Accepted Answer

A) True 
 B)False

Question 18

Muhares,which uses a process-costing system,adds material at the beginning of production and incurs conversion cost evenly throughout manufacturing.The following selected information was taken from the company's accounting records:
Total equivalent units of materials: 8,000
Total equivalent units of conversion: 7,400
Units started and completed during the period: 6,500
On the basis of this information,the ending work-in-process inventory's stage of completion is:

Accepted Answer

A) 80%. 
B) 70%. 
C) 60%. 
D) 40%. 
E) some other percentage not listed abovE. 
A) 80%. 
B) 70%. 
C) 60%. 
D) 40%. 
E) some other percentage not listed abovE.

Question 19

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

Accepted Answer

A) sweaters. 
B) automobiles. 
C) living-room sofas. 
D) dishwashing detergent. 
E) high-definition (H
D) and surround-sound cables. 
A) sweaters. 
B) automobiles. 
C) living-room sofas. 
D) dishwashing detergent. 
E) high-definition (H
D) and surround-sound cables.

Question 20

Companies that use a process-cost accounting system would establish a separate Work-in-Process Inventory account for each manufacturing department.

Accepted Answer

A) True 
 B)False

The cost of the company's ending work-in-process inventory is:

The cost of the ending work in process is:

Which of the following best describes the procedures used in operation costing to assign direct-material and conversion costs to production?

Equivalent-unit calculations are necessary to allocate manufacturing costs between:

Which of the following are needed under weighted-average process costing to calculate the cost of goods completed during the period?

Operation costing:

Which of the following is a key document in a typical process-costing system?

All of the following statements about an operation-costing system are true except:

Yes! Co. ,had 3,000 units of work in process on April 1 that were 60% complete.During April,11,000 units were started and as of April 30,4,000 units that were 40% complete remained in production.How many units were completed during April?

The cost of goods completed is:

Companies that use a process-cost accounting system would:

Barnett,Inc. ,which uses a process-costing system,transfers completed production from Department no.1 to Department no.2 for further work.Which of the following best describes the account that would be credited to record this transfer?

Operation costing tends to parallel job-order costing with respect to the treatment of conversion cost.

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:

Companies that use a process-cost accounting system would establish a separate Work-in-Process Inventory account for each manufacturing department.

The Changing Role of Managerial Accounting in a Dynamic Business Environment

Basic Cost Management Concepts and Accounting for Mass Customization Operations

Product Costing and Cost Accumulation in a Batch Production Environment

Activity-Based Costing and Management

Activity Analysis,cost Behavior,and Cost Estimation

Appendix I: The Sarbanes-Oxley Act, Internal Controls, and Management Accounting

Cost-Volume-Profit Analysis

Absorption and Variable Costing

Profit Planning and Activity-Based Budgeting

Standard Costing,Operational Performance Measures,and the Balanced Scorecard

Flexible Budgeting and the Management of Overhead and Support Activity Costs

Responsibility Accounting, Quality Control, and Environmental Cost Management

Investment Centers and Transfer Pricing

Decision Making: Relevant Costs and Benefits

Target Costing and Cost Analysis for Pricing Decisions

Capital Expenditure Decisions

Allocation of Support Activity Costs and Joint Costs

compound Interest and the Concept of Present Value

Inventory Management

Filters

Exam 4: Process Costing and Hybrid Product-Costing Systems

The cost of the company's ending work-in-process inventory is:

The cost of the ending work in process is:

Which of the following best describes the procedures used in operation costing to assign direct-material and conversion costs to production?

Equivalent-unit calculations are necessary to allocate manufacturing costs between:

Which of the following are needed under weighted-average process costing to calculate the cost of goods completed during the period?

Operation costing:

Which of the following is a key document in a typical process-costing system?

All of the following statements about an operation-costing system are true except:

Yes! Co. ,had 3,000 units of work in process on April 1 that were 60% complete.During April,11,000 units were started and as of April 30,4,000 units that were 40% complete remained in production.How many units were completed during April?

The cost of goods completed is:

Companies that use a process-cost accounting system would:

Barnett,Inc. ,which uses a process-costing system,transfers completed production from Department no.1 to Department no.2 for further work.Which of the following best describes the account that would be credited to record this transfer?

Operation costing tends to parallel job-order costing with respect to the treatment of conversion cost.

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:

Companies that use a process-cost accounting system would establish a separate Work-in-Process Inventory account for each manufacturing department.

The Changing Role of Managerial Accounting in a Dynamic Business Environment

Basic Cost Management Concepts and Accounting for Mass Customization Operations

Product Costing and Cost Accumulation in a Batch Production Environment

Activity-Based Costing and Management

Activity Analysis,cost Behavior,and Cost Estimation

Appendix I: The Sarbanes-Oxley Act, Internal Controls, and Management Accounting

Cost-Volume-Profit Analysis

Absorption and Variable Costing

Profit Planning and Activity-Based Budgeting

Standard Costing,Operational Performance Measures,and the Balanced Scorecard

Flexible Budgeting and the Management of Overhead and Support Activity Costs

Responsibility Accounting, Quality Control, and Environmental Cost Management

Investment Centers and Transfer Pricing

Decision Making: Relevant Costs and Benefits

Target Costing and Cost Analysis for Pricing Decisions

Capital Expenditure Decisions

Allocation of Support Activity Costs and Joint Costs

compound Interest and the Concept of Present Value

Inventory Management

Filters