Exam 5: Process Costing

The FIFO method requires that any units in beginning inventory be costed separately from any units started in the current period.

The May Corporation uses a process system. During the current period, 2600 units were started and 2100 units were completed and transferred out. Ending units were 50% complete for materials and 45% complete for conversion costs. Direct materials costs added were $44,405 and conversion costs added were $29,870. There was no beginning WIP Inventory and conversion costs are added evenly throughout the process. At the end of the period, the cost per equivalent unit for direct materials would be closest to

The journal entry to record the use of direct labor in Processing Department #1 would include a credit to Wages Payable.

The following information is provided by Mel Company: The units in ending WIP Inventory were 90% complete for materials and 25% complete for conversion costs. Required: a. What are the total equivalent units for direct materials? b. At the end of the year, what are the equivalent units for conversion costs?

During a period, 40,200 units were completed and 3200 units were in ending WIP Inventory. Ending WIP was 95% complete for direct materials and 50% complete for conversion costs. What are the equivalent units for direct materials?

Process costing differs from job costing in that process costing doesn't directly trace any materials or labor to any part of the production process.

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.

If a company has no ending Work In Process Inventory, it does not need to use the 5-step process costing procedure to determine the cost of making one unit.

At Opal Incorporated, direct materials are added at the beginning of the process and conversions costs are uniformly applied. Other details include: What is the total cost of units remaining in ending WIP?

The first step of the 5-step process costing procedure is to summarize total costs to account for.

At Trapeze Corporation, direct materials are added at the beginning of the process and conversions costs are uniformly applied. Other details include: What is the cost per equivalent unit for conversion costs?

Flying High Manufacturing produces frisbees using a three-step process that includes molding, coloring and finishing. The purchase of materials includes a

Freddie Company adds direct materials at the beginning of the process and adds conversion costs throughout the process. Data for the Finishing Department follows: The cost per equivalent unit for conversion costs would be closest to

When units are transferred from Processing Department #1 to Processing Department #2, a credit is made to WIP-Processing Department #1 to reflect the transferred-out costs.

Flying High Manufacturing produces frisbees using a three-step sequential process that includes molding, coloring and finishing. When the frisbees and associated costs are transferred from the molding process to the coloring process, which account is debited?

Flying High Manufacturing produces frisbees using a three-step process that includes molding, coloring and finishing. Which of the following accounts is credited for direct labor used during the molding process?

At Opal Incorporated, direct materials are added at the beginning of the process and conversions costs are uniformly applied. Other details include: What is the total cost of units completed and transferred out?

During a period, 43,200 units were completed and 5000 units were in ending WIP Inventory. Ending WIP was 70% complete for direct materials and 50% complete for conversion costs. What are the equivalent units for conversion costs?

In Step 1 of the process costing procedure, the "total units to account for" is the sum of

The production equivalent unit report summarizes all costs.