Exam 17: Process Cost Systems

The Mountain Springs Water Company has two departments,Purifying and Bottling.The Bottling Department received 58,000 liters from the Purifying Department.During the period,the Bottling Department completed 56,000 liters,including 4,000 liters of work in process at the beginning of the period.The ending work in process was 6,000 liters.How many liters were started and completed during the period?

In a process cost system,product costs are accumulated by processing department rather than by job.

The number of equivalent units of production for material costs for the period was

The journal entry to record the flow of costs into Department 2 for direct labor is

Conversion and direct materials are generally both added at the end of the production process.

Conversion costs are usually incurred evenly throughout a process.

If the costs for direct materials,direct labor,and factory overhead were $60,000,$35,000,and $25,000,respectively,for 20,000 equivalent units of production,the conversion cost per equivalent unit was $6.

Tough Hardware purchases raw materials and processes those purchases through a receiving / inspection process prior to stocking for production.Tough places 3 purchase orders for materials for production and receives the goods that day.The first PO is for 2,500 1 / 2" × 96" milling blanks at $2.75 each.The second is for 4,000 pieces of 48" × 96" × 1" sheet steel at $15.55 each.The third PO is for five 5 gallon drums of milling lubrication oil at $475.00 per barrel. ​ ​The receiving / inspection process is completed and the goods are transferred from Receiving Inventory to Raw Materials.The Receiving / Inspection Department assigns manufacturing overhead of $55.00 per purchase order as well as $2.75 per piece on metal goods and $35.00 per container on fluids.All labor is allocated through overhead. ​(a)Write the journal entry to purchase and receive these items to Receiving Inventory on account. ​(b)Assign overhead to the metal goods. ​(c)Assign overhead to the fluid goods. ​(d)Transfer all goods to Raw Materials Inventory.

The Mountain Springs Water Company has two departments,Purifying and Bottling.The Bottling Department received 67,000 liters from the Purifying Department.During the period,the Bottling Department completed 65,000 liters,including 3,000 liters of work in process at the beginning of the period.The ending work in process was 5,000 liters.How many liters were started and completed during the period?

Department S had 500 units 60% completed in process at the beginning of the period; 9,000 units completed during the period; and 600 units 30% completed at the end of the period.What was the number of equivalent units of production for the period for conversion if the first-in,first-out method is used to cost inventories? Assume the completion percentage applies to both direct materials and conversion cost.

Assuming that all direct materials are placed in process at the beginning of production and that the first-in,first-out method of inventory costing is used,what is the equivalent units for materials and conversion costs,respectively?

If the average cost method is used,the materials cost per unit (to the nearest cent)would be

All direct materials are placed in process at the beginning of production and the first-in,first-out method of inventory costing is used.What is the total cost of 3,600 units of beginning inventory which were completed during the period (round unit cost calculations to four decimal places)?

Process manufacturing usually reflects a manufacturer that produces small quantities of unique items.

If the costs for direct materials,direct labor,and factory overhead were $522,200,$82,700,and $45,300,respectively,for 16,000 equivalent units of production,the conversion cost per equivalent unit was $8.00.

On March 1,Upton Company's Packaging Department had work in process inventory of 8,820 units,which had been transferred in from the Finishing Department.These units had accumulated costs of $315,000 in previous departments and $16,000 for conversion costs in the Packaging Department. During March,30,000 units were transferred into the department.These units had accumulated costs of $770,000 in the previous departments.The Packaging Department incurred $54,000 in conversion costs during the month.On March 31,700 units remained in ending inventory.These units were 80% complete with respect to conversion costs. ​ Calculate the cost per equivalent unit for transferred-in costs and for conversion costs for the Packaging Department using the average cost method.

The number of equivalent units of production for the period for conversion if the first-in,first-out method is used to cost inventories was

Mocha Company manufactures a single product by a continuous process,involving three production departments.The records indicate that direct materials,direct labor,and applied factory overhead for Department 1 were $100,000,$125,000,and $150,000,respectively.Work in process at the beginning of the period for Department 1 was $75,000,and work in process at the end of the period totaled $60,000.The records indicate that direct materials,direct labor,and applied factory overhead for Department 2 were $50,000,$60,000,and $70,000,respectively.In addition,work in process at the beginning of the period for Department 2 totaled $75,000,and work in process at the end of the period totaled $60,000.The journal entry to record the flow of costs into Department 3 during the period is

If a department that applies FIFO process costing starts the reporting period with 50,000 physical units that were 25% complete with respect to direct materials and 40% complete with respect to conversion,it must add 12,500 equivalent units of direct materials and 20,000 equivalent units to direct labor to complete them.

Lean manufacturing is a business philosophy that focuses on reducing time and cost and eliminating poor quality.This is accomplished in manufacturing and nonmanufacturing processes by