Question 1

To calculate the equivalent units of production, the number of physical units is divided by the percentage of completion.

Accepted Answer

A) True 
 B)False

Question 2

The following information concerns Transformation Inc.'s equivalent units in June: $\begin{array}{lr}\text { units }\
\text { Beginning Work-in-Process Inventory (50\% complete) } & 2,000 \
\text { Units started during June } & 10,900 \
\text { Units completed and transferred } & 10,000 \
\text { Ending Work-in-Process Inv entory (70\% complete) } & 2,900
\end{array}$ What are Transformation's equivalent units for June when using the weighted average costing method?

Accepted Answer

A)  10,000 
B)  12,030 
C)  12,900 
D)  22,900 
A)  10,000 
B)  12,030 
C)  12,900 
D)  22,900

Question 3

Which method combines partially completed units in beginning inventory with current period production when computing equivalent units of production?

Accepted Answer

A)  actual cost method 
B)  FIFO costing method 
C)  LIFO costing method 
D)  weighted average costing method 
A)  actual cost method 
B)  FIFO costing method 
C)  LIFO costing method 
D)  weighted average costing method

Question 4

The Glove Company uses the weighted average costing method. The beginning Work-in-Process Inventory consists of 25,000 units (100% completed as to materials and 50% complete as to conversion costs). The number of units completed was 100,000. The ending Work-in-Process Inventory consists of 15,000 units (100% complete as to materials and 25% complete as to conversion costs). What would be the equivalent units of production for conversion costs?

Accepted Answer

A)  40,000 
B)  103,750 
C)  112,500 
D)  116,250 
A)  40,000 
B)  103,750 
C)  112,500 
D)  116,250

Question 5

Refer to Red Manufacturing. What would be the total cost of the units in the ending Work-in-Process Inventory at October 31 when using the weighted average costing method?

Accepted Answer

A)  $153,960 
B)  $154,800 
C)  $155,328 
D)  $156,960 
A)  $153,960 
B)  $154,800 
C)  $155,328 
D)  $156,960

Question 6

Which business is most likely to use process costing?

Accepted Answer

A)  a dentist 
B)  an accounting firm 
C)  a tire manufacturer 
D)  a custom machine manufacturer 
A)  a dentist 
B)  an accounting firm 
C)  a tire manufacturer 
D)  a custom machine manufacturer

Question 7

Queen Corporation produces a product that passes through two departments. For November, the following equivalent unit schedule was prepared for the first department: $\begin{array}{lrr}
&\underline{\text { Materials }}&\underline{\text { Conversion}}\
&\underline{\text { Cost }} \
\text { Units completed } & 20,000 & 20,000 \
\text { Units in ending Work-in-Process Inventory } \times \text { Fraction complete: } & & \
\text { Materials }(4,000 \times 100 \%) & \underline{4,000} & \
\text { Conversion }(4,000 \times 50 \%) & & \underline{2,000} \
\quad \text { Equivalent units of output } & \underline{24,000} & \underline{\underline{22,000}}
\end{array}$
 Costs assigned to beginning Work-in-Process Inventory:
Materials: $18,000
Conversion: $22,000
Manufacturing costs incurred during the month:
Materials: $46,800
Conversion: $53,900
Required:
A. Compute the unit cost in the first department for November using the weighted average costing method.
B. Determine the cost of goods transferred out.
C. Determine the cost of ending Work-in-Process Inventory.

Accepted Answer

A. Cost per equivalent unit:
Materials =

Question 8

Beginning inventory for the month contained 3,000 units that were 60% complete with respect to materials. During the month, 50,000 units were completed and transferred out. Ending inventory contained 5,000 units that were 30% complete with respect to materials. What would be the weighted average equivalent units of production for materials for the month?

Accepted Answer

A)  51,500 
B)  50,300 
C)  50,000 
D)  49,500 
A)  51,500 
B)  50,300 
C)  50,000 
D)  49,500

Question 9

The FIFO costing method assumes that units in beginning Work-in-Process Inventory are completed first, before any new units are started.

Accepted Answer

A) True 
 B)False

Question 10

Which account do the costs of completed products move to after Work-in-Process Inventory?

Accepted Answer

A)  Sales 
B)  Expenses 
C)  Cost of Goods Sold 
D)  Finished Goods Inventory 
A)  Sales 
B)  Expenses 
C)  Cost of Goods Sold 
D)  Finished Goods Inventory

Question 11

Explain the role of the departmental production report in process costing, and name the five steps for completing the departmental production report.

Accepted Answer

The production report summarizes cost an

Question 12

The cost information section of the production report has two major subdivisions: (1) costs to account for; and (2) costs accounted for.

Accepted Answer

A) True 
 B)False

Question 13

Which method considers the percentage of completion of beginning Work-in-Process Inventory?

Accepted Answer

A)  CVP analysis 
B)  FIFO costing method 
C)  LIFO costing method 
D)  weighted average costing method 
A)  CVP analysis 
B)  FIFO costing method 
C)  LIFO costing method 
D)  weighted average costing method

Question 14

In process costing, it is reasonable to assume uniform application of material costs.

Accepted Answer

A) True 
 B)False

Question 15

The FIFO costing method separates work and costs of the equivalent units in beginning inventory from work and costs of the equivalent units produced during the current period. Only current work and costs are used to calculate this period's unit cost.

Accepted Answer

A) True 
 B)False

Question 16

Match each following terms with their correct description from the items listed below.
-Partially completed units can be worked on simultaneously in different processes then brought together in a final process for completion.

Accepted Answer

A) Parallel processing 
B) Sequential processing 
C) Process costing 
D) Weighted average costing method 
A) Parallel processing 
B) Sequential processing 
C) Process costing 
D) Weighted average costing method

Question 17

Assume conversion costs represent a single category. How many input categories would be typical for a department receiving transferred-in goods?

Accepted Answer

A)  2 
B)  3 
C)  4 
D)  5 
A)  2 
B)  3 
C)  4 
D)  5

Question 18

When should process costing techniques be used in assigning costs to products?

Accepted Answer

A)  when the product is unique and made to order 
B)  when the product is manufactured according to customer specifications 
C)  when the product is composed of mass-produced homogeneous products 
D)  any time production is only partially completed during the accounting period 
A)  when the product is unique and made to order 
B)  when the product is manufactured according to customer specifications 
C)  when the product is composed of mass-produced homogeneous products 
D)  any time production is only partially completed during the accounting period

Question 19

Which statement best describes sequential processing?

Accepted Answer

A)  A large number of similar products pass through an identical set of processes. 
B)  Units must pass through one process before they can be worked on in later processes. 
C)  Units typically pass through a series of manufacturing or producing departments at the same time. 
D)  Partially completed units can be worked on simultaneously in different processes and then brought together in a final process for completion. 
A)  A large number of similar products pass through an identical set of processes. 
B)  Units must pass through one process before they can be worked on in later processes. 
C)  Units typically pass through a series of manufacturing or producing departments at the same time. 
D)  Partially completed units can be worked on simultaneously in different processes and then brought together in a final process for completion.

Question 20

Process costing systems are specifically designed to support costing of mass-produced heterogeneous products.

Accepted Answer

A) True 
 B)False

To calculate the equivalent units of production, the number of physical units is divided by the percentage of completion.

Which method combines partially completed units in beginning inventory with current period production when computing equivalent units of production?

Refer to Red Manufacturing. What would be the total cost of the units in the ending Work-in-Process Inventory at October 31 when using the weighted average costing method?

Which business is most likely to use process costing?

The FIFO costing method assumes that units in beginning Work-in-Process Inventory are completed first, before any new units are started.

Which account do the costs of completed products move to after Work-in-Process Inventory?

Explain the role of the departmental production report in process costing, and name the five steps for completing the departmental production report.

The cost information section of the production report has two major subdivisions: (1) costs to account for; and (2) costs accounted for.

Which method considers the percentage of completion of beginning Work-in-Process Inventory?

In process costing, it is reasonable to assume uniform application of material costs.

The FIFO costing method separates work and costs of the equivalent units in beginning inventory from work and costs of the equivalent units produced during the current period. Only current work and costs are used to calculate this period's unit cost.

Match each following terms with their correct description from the items listed below. -Partially completed units can be worked on simultaneously in different processes then brought together in a final process for completion.

Assume conversion costs represent a single category. How many input categories would be typical for a department receiving transferred-in goods?

When should process costing techniques be used in assigning costs to products?

Which statement best describes sequential processing?

Process costing systems are specifically designed to support costing of mass-produced heterogeneous products.

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behaviour

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Activity-Based Costing and Management

Absorption and Variable Costing, and Inventory Management

Budgeting, Production, Cash, and Master Budget

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Filters

Exam 6: Process Costing

To calculate the equivalent units of production, the number of physical units is divided by the percentage of completion.

Which method combines partially completed units in beginning inventory with current period production when computing equivalent units of production?

Refer to Red Manufacturing. What would be the total cost of the units in the ending Work-in-Process Inventory at October 31 when using the weighted average costing method?

Which business is most likely to use process costing?

The FIFO costing method assumes that units in beginning Work-in-Process Inventory are completed first, before any new units are started.

Which account do the costs of completed products move to after Work-in-Process Inventory?

Explain the role of the departmental production report in process costing, and name the five steps for completing the departmental production report.

The cost information section of the production report has two major subdivisions: (1) costs to account for; and (2) costs accounted for.

Which method considers the percentage of completion of beginning Work-in-Process Inventory?

In process costing, it is reasonable to assume uniform application of material costs.

The FIFO costing method separates work and costs of the equivalent units in beginning inventory from work and costs of the equivalent units produced during the current period. Only current work and costs are used to calculate this period's unit cost.

Match each following terms with their correct description from the items listed below. -Partially completed units can be worked on simultaneously in different processes then brought together in a final process for completion.

Assume conversion costs represent a single category. How many input categories would be typical for a department receiving transferred-in goods?

When should process costing techniques be used in assigning costs to products?

Which statement best describes sequential processing?

Process costing systems are specifically designed to support costing of mass-produced heterogeneous products.

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behaviour

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Activity-Based Costing and Management

Absorption and Variable Costing, and Inventory Management

Budgeting, Production, Cash, and Master Budget

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Filters