Question 1

Process costing can be used for ________ activities.

Accepted Answer

A)  manufacturing 
B)  nonmanufacturing 
C)  manufacturing and nonmanufacturing 
D)  none of the above 
A)  manufacturing 
B)  nonmanufacturing 
C)  manufacturing and nonmanufacturing 
D)  none of the above

Question 2

Gomez Company manufactures generic notebooks.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 June follow:
Work-In-Process Inventory,June 1:
$\begin{array} { l  }
 \text { Units}&15,000\
 \text {Direct materials ( $ 100 \% $ complete) }&\$35,000\
 \text {Conversion costs ( $ 30 \% $ complete) }&\$8,400\
\end{array}$

$\begin{array} { l  }
 \text {Units started in June }&65,000\
 \text { Units completed in June}&62,000\
 \text {Work-In-Process Inventory, June 30 }&18,000\
\end{array}$

$\begin{array} { l  }
 \text {Direct materials added in June }&\$285,000\
 \text {Conversion costs added in June }&\$210,000\
\end{array}$

With regard to the Work-In-Process Inventory on June 30,materials are 100 percent complete and conversion costs are 60 percent complete.The total cost of goods transferred out of the Printing Department is ________.

Accepted Answer

A)  $420,825 
B)  $434,000 
C)  $495,000 
D)  $543,000 
A)  $420,825 
B)  $434,000 
C)  $495,000 
D)  $543,000

Question 3

In job-order costing,a Debit to Direct Materials Inventory is used to record ________.

Accepted Answer

A)  a requisition of direct materials for production 
B)  cost of goods completed 
C)  a sale of goods 
D)  a purchase of direct materials 
A)  a requisition of direct materials for production 
B)  cost of goods completed 
C)  a sale of goods 
D)  a purchase of direct materials

Question 4

In job-order costing,the journal entry to record the completion of goods would include a Debit to Cost of Goods Sold.

Accepted Answer

A) True 
 B)False

Question 5

Elmbrook Hospital uses a job-order costing system for all patients who have surgery.The following information is available:
$\begin{array} { l  }
 \text { Budgeted indirect costs-pre-operating room}&\$84,000 \
 \text {udgeted indirect costs-operating room}&\$ 66,000\
 \text {Budgeted indirect costs-surgery recovery floor }&\$ 600,000\
 \text { Budgeted nursing hours-pre-operating roo}&4,000 \
 \text {Budgeted nursing hours-operating room }&1,000 \
 \text {Budgeted nursing hours - sur gery recovery floor }&7,500 \
\end{array}$

The cost driver for all indirect costs is nursing hours.The hospital uses a budgeted rate for indirect costs.A patient spent 8 hours in the pre-operating room,4 hours in the operating room and 96 hours on the surgery recovery floor.What amount of indirect costs will be applied to this patient?

Accepted Answer

A)  $336.00 
B)  $600.00 
C)  $7,680 
D)  $8,112 
A)  $336.00 
B)  $600.00 
C)  $7,680 
D)  $8,112

Question 6

El Rey Company manufactures generic notebooks.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 June follow:
Work-In-Process Inventory,June 1:
$\begin{array} { l  }
 \text { Units}&15,000\
 \text {Direct materials ( $ 100 \% $ complete) }&\$35,000\
 \text {Conversion costs ( $ 30 \% $ complete) }&\$8,400\
\end{array}$

$\begin{array} { l  }
 \text {Units started in June }&65,000\
 \text { Units completed in June}&62,000\
 \text {Work-In-Process Inventory, June 30 }&18,000\
\end{array}$

$\begin{array} { l  }
 \text {Direct materials added in June }&\$285,000\
 \text {Conversion costs added in June }&\$210,000\
\end{array}$

With regard to the Work-In-Process Inventory on June 30,materials are 100 percent complete and conversion costs are 60 percent complete.The total cost of the ending Work-In-Process Inventory is ________.

Accepted Answer

A)  $104,400 
B)  $111,996 
C)  $122,175 
D)  $127,260 
A)  $104,400 
B)  $111,996 
C)  $122,175 
D)  $127,260

Question 7

Bradley Company manufactures generic notebooks.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 June follow:
Work-In-Process Inventory,June 1:
$\begin{array} { l  }
 \text { Units }&15,000\
 \text {Direct materials ( $ 100 \% $ complete)  }&\$34,000\
 \text { Conversion costs ( $ 30 \% $ complete)}&\$14,000\
\end{array}$

$\begin{array} { l  }
 \text {Units started in June }&65,000\
 \text { Units completed in June}&62,000\
 \text {Work-In-Process Inventory, June } 30&18,000\
\end{array}$

$\begin{array} { l  }
 \text {Direct materials added in June }&\$285,000\
 \text { Conversion costs added in June}&\$210,000\
\end{array}$

With regard to the Work-In-Process Inventory on June 30,materials are 100 percent complete and conversion costs are 50 percent complete.What are the equivalent units for conversion costs for June?

Accepted Answer

A)  62,000 
B)  68,300 
C)  71,000 
D)  80,000 
A)  62,000 
B)  68,300 
C)  71,000 
D)  80,000

Question 8

In process costing,goods are moved from the Assembly Department to the Packaging Department.Costs incurred in the Assembly Department for the goods received by the Packaging Department are called ________ by the Packaging Department.

Accepted Answer

A)  equivalent units 
B)  finished goods 
C)  transferred-in costs 
D)  factory overhead applied 
A)  equivalent units 
B)  finished goods 
C)  transferred-in costs 
D)  factory overhead applied

Question 9

Source documents used in job-order costing include ________.

Accepted Answer

A)  labor time tickets 
B)  material requisitions 
C)  time cards 
D)  all of the above 
A)  labor time tickets 
B)  material requisitions 
C)  time cards 
D)  all of the above

Question 10

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

Accepted Answer

A)  90,000 
B)  140,000 
C)  160,000 
D)  180,000 
A)  90,000 
B)  140,000 
C)  160,000 
D)  180,000

Question 11

Two extremes of product-costing are job-order costing and normal-order costing.

Accepted Answer

A) True 
 B)False

Question 12

In process costing,units that are started but NOT completed by the end of the accounting period are called ________.

Accepted Answer

A)  Cost of Goods Sold 
B)  ending Direct Materials Inventory 
C)  ending Work-In-Process Inventory 
D)  ending Finished Goods Inventory 
A)  Cost of Goods Sold 
B)  ending Direct Materials Inventory 
C)  ending Work-In-Process Inventory 
D)  ending Finished Goods Inventory

Question 13

Assume a company uses process costing.When factory overhead is applied to the units in production,Finished Goods Inventory is the Debit part of the journal entry.

Accepted Answer

A) True 
 B)False

Question 14

In process costing,the journal entry to record direct labor costs incurred associated with units in a department would include a ________.

Accepted Answer

A)  Debit to Accrued Payroll 
B)  Credit to Factory Overhead 
C)  Debit to Work-in-Process Inventory-Department Name 
D)  Credit to Finished Goods Inventory 
A)  Debit to Accrued Payroll 
B)  Credit to Factory Overhead 
C)  Debit to Work-in-Process Inventory-Department Name 
D)  Credit to Finished Goods Inventory

Question 15

Nicholson Company uses job order costing.Supporting documents for the Work-In-Process Inventory account do NOT include ________.

Accepted Answer

A)  labor time tickets 
B)  time cards 
C)  materials requisition forms 
D)  schedule of actual factory overhead costs 
A)  labor time tickets 
B)  time cards 
C)  materials requisition forms 
D)  schedule of actual factory overhead costs

Question 16

In job-order costing,the journal entry to record the transfer of completed goods from the production area would include a Credit to ________.

Accepted Answer

A)  Cost of Goods Sold 
B)  Finished Goods Inventory 
C)  Factory Department Overhead Control 
D)  Work-In-Process Inventory 
A)  Cost of Goods Sold 
B)  Finished Goods Inventory 
C)  Factory Department Overhead Control 
D)  Work-In-Process Inventory

Question 17

The weighted-average method of process costing adds the cost of all work done in the current period to ________.

Accepted Answer

A)  the ending work-in-process inventory 
B)  all costs estimated to be incurred in the next department 
C)  the cost of the work done in the preceding period to the current period's ending work-in-process inventory 
D)  the cost of the work done in the preceding period to the current period's beginning work-in-process inventory 
A)  the ending work-in-process inventory 
B)  all costs estimated to be incurred in the next department 
C)  the cost of the work done in the preceding period to the current period's ending work-in-process inventory 
D)  the cost of the work done in the preceding period to the current period's beginning work-in-process inventory

Question 18

During the month of May,Gonzalez Clothing transferred 140,000 shirts to Finished Goods Inventory.There was no beginning work-in-process inventory.The company had 30,000 shirts in process at May 31 and the shirts were 50 percent complete with respect to conversion costs.All direct materials are added at the beginning of the production process.How many shirts were started during May?

Accepted Answer

A)  30,000 
B)  110,000 
C)  140,000 
D)  170,000 
A)  30,000 
B)  110,000 
C)  140,000 
D)  170,000

Question 19

Xerox Company produces plastic cups in a one-department process.The following data is available for the past month:
$\begin{array} { l  }
 \text {Work-in-process inventory, beginning }&0 \
 \text {Units started }& 60,000\
 \text {Units completed and transferred }&48,000 \
 \text {Work-in-process inventory, ending }&12,000 \
\end{array}$

The units in process at the end of the month are 100 percent complete with respect to materials and 50 percent complete with respect to conversion costs.What are the equivalent units for materials for the month?

Accepted Answer

A)  12,000 
B)  48,000 
C)  54,000 
D)  60,000 
A)  12,000 
B)  48,000 
C)  54,000 
D)  60,000

Question 20

Zimmerman Company manufactures plastic cups in one department.The following information is available:
$\begin{array} { l  }
 \text {Work-In-Process Inventory, beginning }&0\
 \text { Units started}&60,000\
 \text {Units completed and transferred }&48,000\
 \text {Work-In-Process Inventory, end}&12,000\
\end{array}$

$\begin{array} { l  }
 \text {Direct materials added }&\$ 180,000\
 \text {Direct labor }&\$165,600 \
 \text {Factory overhead }&\$ 82,800\
\end{array}$

The units in the ending Work-In-Process Inventory are 50 percent complete with respect to direct materials and 60 percent complete with respect to conversion costs.The unit cost of direct materials is ________.

Accepted Answer

A)  $1.00 
B)  $3.00 
C)  $3.33 
D)  $5.00 
A)  $1.00 
B)  $3.00 
C)  $3.33 
D)  $5.00

Process costing can be used for ________ activities.

In job-order costing,a Debit to Direct Materials Inventory is used to record ________.

In job-order costing,the journal entry to record the completion of goods would include a Debit to Cost of Goods Sold.

In process costing,goods are moved from the Assembly Department to the Packaging Department.Costs incurred in the Assembly Department for the goods received by the Packaging Department are called ________ by the Packaging Department.

Source documents used in job-order costing include ________.

Two extremes of product-costing are job-order costing and normal-order costing.

In process costing,units that are started but NOT completed by the end of the accounting period are called ________.

Assume a company uses process costing.When factory overhead is applied to the units in production,Finished Goods Inventory is the Debit part of the journal entry.

In process costing,the journal entry to record direct labor costs incurred associated with units in a department would include a ________.

Nicholson Company uses job order costing.Supporting documents for the Work-In-Process Inventory account do NOT include ________.

In job-order costing,the journal entry to record the transfer of completed goods from the production area would include a Credit to ________.

The weighted-average method of process costing adds the cost of all work done in the current period to ________.

Managerial Accounting,the Business Organization,and Professional Ethics

Introduction to Cost Behavior and Cost Volume Profit Relationships

Measurement of Cost Behavior

Cost Management Systems and Activity-Based Costing

Relevant Information for Decision Making With a Focus on Pricing Decisions

Relevant Information for Decision Making With a Focus on Operational Decisions

Introduction to Budgets and Preparing the Master Budget

Flexible Budgets and Variance Analysis

Management Control Systems and Responsibility Accounting

Management Control in Decentralized Organizations

Capital Budgeting

Cost Allocation

Accounting for Overhead Costs

Basic Accounting: Concepts, techniques, and Conventions

Understanding Corporate Annual Reports: Basic Financial Statements

Understanding and Analyzing Consolidated Financial Statements

Filters

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

Process costing can be used for ________ activities.

In job-order costing,a Debit to Direct Materials Inventory is used to record ________.

In job-order costing,the journal entry to record the completion of goods would include a Debit to Cost of Goods Sold.

In process costing,goods are moved from the Assembly Department to the Packaging Department.Costs incurred in the Assembly Department for the goods received by the Packaging Department are called ________ by the Packaging Department.

Source documents used in job-order costing include ________.

Two extremes of product-costing are job-order costing and normal-order costing.

In process costing,units that are started but NOT completed by the end of the accounting period are called ________.

Assume a company uses process costing.When factory overhead is applied to the units in production,Finished Goods Inventory is the Debit part of the journal entry.

In process costing,the journal entry to record direct labor costs incurred associated with units in a department would include a ________.

Nicholson Company uses job order costing.Supporting documents for the Work-In-Process Inventory account do NOT include ________.

In job-order costing,the journal entry to record the transfer of completed goods from the production area would include a Credit to ________.

The weighted-average method of process costing adds the cost of all work done in the current period to ________.

Managerial Accounting,the Business Organization,and Professional Ethics

Introduction to Cost Behavior and Cost Volume Profit Relationships

Measurement of Cost Behavior

Cost Management Systems and Activity-Based Costing

Relevant Information for Decision Making With a Focus on Pricing Decisions

Relevant Information for Decision Making With a Focus on Operational Decisions

Introduction to Budgets and Preparing the Master Budget

Flexible Budgets and Variance Analysis

Management Control Systems and Responsibility Accounting

Management Control in Decentralized Organizations

Capital Budgeting

Cost Allocation

Accounting for Overhead Costs

Basic Accounting: Concepts, techniques, and Conventions

Understanding Corporate Annual Reports: Basic Financial Statements

Understanding and Analyzing Consolidated Financial Statements

Filters