Exam 14: Job-Order Costing and Process-Costing Systems

Keller Company manufactures plastic cups in one department.The following information is available: Work-In-Process Inventory, beginning 0 Units started 60,000 Units completed and transferred 48,000 Work-In-Process Inventory, end 12,000 Direct materials added \ 240,000 Direct labor \1 64,780 Factory overhead \ 82,000 The units in the ending Work-In-Process Inventory are 50 percent complete with respect to direct materials and 50 percent complete with respect to conversion costs.The unit cost of conversion costs is ________.

Smith manufactures greeting cards.Material is introduced at the beginning of the process in the Printing Department.Conversion costs are applied uniformly throughout the process.The weighted-average method of process costing is used.Data for the Printing Department for the month of September follow: Work-In-Process Inventory,September 1: Units 22,500 Direct materials ( 100 \% complete) \5 1,000 Conversion costs ( 30\% complete) \2 0,472 Units started in September 127,500 Units completed in September 123,000 Work-In-Process Inventory, September 30 27,000 Direct materials added in September 427,500 Conversion costs added in September \3 15,000 With regard to the Work-In-Process Inventory on September 30,materials are 100 percent complete and conversion costs are 50 percent complete.The equivalent units for conversion costs are ________.

Barber Company manufactures tape dispensers.The Assembly Department reported the follow data for the past month: Units started and completed 70,000 Units started and not complete 10,000 Units in beginning inventory 0 Direct materials costs \4 80,000 Conversion costs \2 40,000 The partially complete units at the end of the month were 100 percent complete with respect to materials and 50 percent complete with respect to conversion costs.The cost of one completed unit in the Assembly Department is ________.

When there is beginning work-in-process inventory and process costing,the weighted-average method of inventory costing must be used.

Some companies use hybrid costing,which blends the ideas from both job costing and process costing.

Process costing averages costs over large numbers of nearly identical products.

Kulvekowski Company manufactures aircraft parts.A backflush costing system is used and standard costs for the part follow: Direct materials \1 .50 Conversion costs \2 .00 The parts are scheduled for production only after orders are received.They are shipped immediately upon completion.Product costs are charged directly to Cost of Goods Sold.In July,6,000 parts were produced and immediately shipped to the customer.Materials were purchased for cash at a cost of $10,000 and actual conversion costs were $12,000. Required: Prepare the necessary journal entries.

Carpenter Company uses job-order costing.The following is a summary of factory operations: Direct materials purchased on account \ 125,000 Direct materials requisitioned \1 10,000 Direct labor costs incurred \2 56,000 Factory overhead costs incurred (Depreciation Expense only \1 50,000 Cost of goods completed \ 515,000 Cost of goods sold \ 378,000 Sales on account \ 430,000 Factory overhead applied ? Factory overhead costs are applied at 50% of direct labor costs. Required: A) Prepare the required journal entries for the above transactions. B) Prepare the journal entry to dispose of the overhead variance using the immediate write-off method. C) Is the factory overhead overapplied or underapplied? D) What is the actual, correct amount of Cost of Goods Sold?

A company uses job-order costing.At the end of the year,applied factory overhead costs were $10,000 and actual factory overhead costs were $12,000.The company uses the immediate write-off method to dispose of variances.Which of the following journal entries is necessary under the immediate write-off method?

During the month of May,Masters Company transferred 140,000 gadgets to Finished Goods Inventory.There was no beginning work-in-process inventory.The company had 40,000 gadgets in process at May 31 and the gadgets were 50 percent complete with respect to conversion costs.All direct materials are added at the end of the production process.The equivalent units for materials for May are ________.

An accounting firm is setting the audit fee for a proposed engagement.The budgeted direct professional labor hours are 100 hours at a rate of $100 per hour.Indirect costs are budgeted at 200% of the direct professional labor cost.Travel costs are budgeted at $20,000.If the markup is 100% of total budgeted costs,what is the audit fee?

Equivalent units are determined by multiplying the number of physical units by the percentage of noncompletion.

In a job-order system,the actual factory overhead costs incurred are $150,000.Applied factory overhead costs are $160,000.What entry is needed to dispose of the overhead variance? Use the immediate write-off method.

Department B is the second department in a series of production processes.Department B receives units from Department A.Department B adds materials,labor and overhead to the units received.The company uses process costing.What costs are assigned to each completed unit in Department B?

Ropal Company manufactures tape dispensers.The Assembly Department reported the follow data for the past month: Units started and completed 70,000 Units started and not complete 10,000 Units in beginning inventory 0 Direct materials costs \4 80,000 Conversion costs \2 40,000 The partially complete units at the end of the month were 100 percent complete with respect to materials and 50 percent complete with respect to conversion costs.The total cost of ending work-in-process inventory is ________.

Rachel Company manufactures phones in a two-department process that involves Assembly and Finishing.The Assembly Department reported the follow data for the past month: Direct materials added \ 336,000 Direct labor 460,800 Factory overhead 230,400 Total costs to account for \1 ,027,200 Units started 80,000 Units completed and transferred 67,200 Units not complete 12,800 Units in beginning inventory 0 The partially complete units at the end of the month were 100 percent complete with respect to materials and 75 percent complete with respect to conversion costs.The journal entry to record the units completed and transferred to the Finishing Department includes ________.

Black Company manufactures gadgets in one department.The following information is available: Work-In-Process Inventory, beginning 0 Units started 60,000 Units completed and transferred 48,000 Work-In-Process Inventory, end 12,000 Direct materials added \ 240,000 Direct labor \1 64,780 Factory overhead \ 82,000 The units in the ending Work-In-Process Inventory are 0 percent complete with respect to direct materials and 50 percent complete with respect to conversion costs.Direct materials are added at the end of the process.The total cost of units completed and transferred is ________.

Companies that use job-order costing normally have uniform production steps.

Beckronski Company has the following information available for the month of March: Units Transterred- Direct Conversion in Costs Materials Costs Work-in-process inventory, March 1 240 \ 33,600 0 \ 18,000 * Percent complete 100\% 0\% 62.5\% Transferred-in during March 400 Completed in March 440 Work-in-process inventory, March 31 200 *Percent complete 100\% 0\% 80\% Costs added in March \5 2,000 \1 3,200 \4 8,600 The company uses the weighted-average cost method of process costing.What are the equivalent units for March for direct materials?

St.Vincent's Hospital uses a job-order costing system for all patients who have surgery.The following information is available: Budgeted indirect costs-pre-operating room \8 4,000 udgeted indirect costs-operating room \ 66,000 Budgeted indirect costs-surgery recovery floor \ 600,000 Budgeted nursing hours-pre-operating roo 4,000 Budgeted nursing hours-operating room 1,000 Budgeted nursing hours - sur gery recovery floor 7,500 The cost driver for all indirect costs is nursing hours.The hospital uses a budgeted rate for indirect costs.The budgeted rate for indirect costs for the operating room is ________.