Exam 6: Process Costing

Equivalent percentage completion figures for manufacturing inputs pose a problem for the calculation of equivalent units, unit cost, and valuation of ending Work-in-Process Inventory.

Refer to Red Manufacturing. What would be the unit cost of materials for October when using the weighted average costing method?

Saracha, Inc. manufactures products that pass through two or more processes. The company uses the weighted average costing method to compute unit costs. During October, equivalent units were computed as follows: Materials Conversion Cost Units completed 190,000 190,000 Units in ending Work-in-Process Inventory × Fraction complete: Materials (33,000 × 100%) 33,000 Conversion (33,000 × 30%) 9,900 Equivalent units of output 223,000 199,900 The unit cost was computed as follows: Materials $15.00 Conversion cost 13.00 Total cost per unit $28.00 Required: A. Determine the cost of the goods transferred out. B. Determine the cost of ending Work-in-Process Inventory.

Department ABC The following information is available for Department ABC for the month of September: Units Cost Work-in-Process Inventory, September 1 ( 70\% complete) 5,000 Direct materials \ 6,000 Direct labour 3,000 Manufacturing overhead 4,000 Total Work-in-Process Inventory, September 1 \1 3,000 Started in production during September 20,000 Costs added: Direct materials \ 18,000 Direct labour 8,000 Manufacturing overhead 10,000 Total costs added during September \3 6,000 Work-in-Process Inventory, September 30, (80% complete) 2,000 Materials are added at the beginning of the process. (Round unit costs to two decimal places.) -Refer to Department ABC. What would be the cost per equivalent unit of production for conversion costs when using the FIFO costing method?

Which of the following does NOT appear in the production report?

Ingenuous Company manufactures a product that passes through two processes. The following information is available for the first department for September. All materials are added at the beginning of the process. Beginning Work-in-Process Inventory consisted of 25,000 units that were 80% complete with respect to conversion. Ending Work-in-Process Inventory consisted of 15,000 units that were 40% complete with respect to conversion. During the month, 90,000 units were started in process. Required: A. Prepare a physical flow schedule for the first department. B. Compute equivalent units for the first department using the weighted average costing method.

Select the most appropriate costing system for each of the following industries * Each costing system may be used more than once. -Home builder

Select the most appropriate costing system for each of the following industries * Each costing system may be used more than once. -Vitamin manufacturer

The costs transferred from a prior process to a subsequent process are referred to as transferred-out costs.

Refer to Door Specialists. How many units were started in the second department during March?

Which statement best describes parallel processing?

Match each following terms with their correct description from the items listed below. -It combines beginning inventory costs and work done with current-period costs and work to calculate this period's unit cost.

Which company would be least likely to use a process costing system?

Process costing is most appropriate for manufacturers of unique products.

Refer to Red Manufacturing. What would be the total equivalent units of production for direct materials when using the weighted average costing method?

The FIFO costing method is one of the methods used to calculate equivalent units in process costing.

CandyMan Manufacturing uses a process-cost system and computes cost using the weighted average costing method. During the current period, the beginning Work-in-Process Inventory Inventory cost was $15,000. Manufacturing cost added was $65,000. Suppose CandyMan's ending Work-in-Process Inventory Inventory was valued at $22,000. What must have been the cost of goods transferred?

Match each following terms with their correct description from the items listed below. -Units must pass through one process before they can be worked on in later processes.

Process costing accumulates costs by individual jobs rather than by process.

Match the order of the five steps involved in creating the department production report with the descriptions below. -Calculation of equivalent units