Exam 20: Process Costing

The Refining Department of Ingber Sugar,Inc.had 55,000 tons of sugar to account for in December.Of the 55,000 tons,45,000 tons were completed and transferred to the Boiling Department,and the remaining 10,000 tons were 60% complete.The materials required for production are added at the beginning of the process.Conversion costs are added equally throughout the refining process.Calculate the total equivalent units of production for conversion costs.

On September 30,the Sorting Department of Tea Works had ending Work-in-Process Inventory of 30,000 units that was 43% complete for materials and 35% complete for conversion costs.This means that for the beginning Work-in-Process Inventory,________% of the materials and ________% of conversion costs were added during October.

A production cost report cannot be used for the pricing of products because it depicts only the ways to control product costs.

On September 30,the Drying Department of Green Tea,Inc.had Work-in-Process Inventory that was 30% complete for materials and 20% complete for conversion costs.This means that for the ending Work-in-Process inventory,________% of materials and ________% of the conversion costs were added during September.

In process costing,factory rent and utilities are debited to the ________.

List the four steps,in the order of occurrence,that are used in preparing a production cost report.

Dakota,Inc.purchased raw materials worth $4,000 on account.The journal entry to record the purchase of raw materials on account is ________.

The costs that are transferred out from one process to another process become transferred in costs for the receiving process.

The Polishing Department of Laminates,Inc.had 15,000 units in process on June 1 and received 25,000 units from the Machining Department.What is the number of units to account for by the Polishing Department for June? The company uses the FIFO costing method.

Under process costing,the costs incurred by each department are reported in a separate production cost report for each department.

Organic Sugar,Inc.in Ohio has six processing departments for refining sugar-Affination,Carbonatation,Decolorization,Boiling,Recovery,and Packaging.Conversion costs are added evenly throughout each process.Data from the month of August for the Decolorization Department are as follows: The ending Work-in-Process Inventory is 100% and 70% complete with respect to direct materials and conversion costs,respectively.Compute the equivalent units of production (EUP)for direct materials and for conversion costs for the month of August.

During September,the Filtering Department of Downtown Center,Inc.had a beginning Work-in-Process Inventory of 500 units with costs of $78,000.During the month,800 units were transferred in from the Milling Department with costs of $211,000.It had 500 units in ending Work-in-Process Inventory.What is the cost per equivalent unit of production for the transferred in units that were transferred to the Filtering Department in September under the first-in,first-out (FIFO)method? (Round your answer to the nearest cent. )

If a business operates in an industry that experiences significant cost changes,should the business prepare its production cost report using the FIFO method or the weighted-average method? Explain your answer.

Travel Trails,Inc.manufactures railway coaches and uses the FIFO method of process costing to record costs.The Work-in-Process Inventory of the Heating Department on October 1 was 73% complete for materials and 24% complete for conversion costs.On October 31,its ending Work-in-Process Inventory was 84% complete for materials and 45% complete for conversion costs.This means that for the ending inventory,________% of the materials and ________% of the conversion costs were added during October.

For each of the following statements,indicate whether the statement applies to Job Order Costing Systems (JO)or Process Costing Systems (PC).

List five ways in which managers use a production cost report to make decisions for their companies.

Production cost reports prepared using first-in,first-out (FIFO)method determine the average cost of equivalent units of production by combining beginning inventory costs with current period costs.

How is a production cost report prepared using the FIFO method?

Southwest Sugar,Inc.has six processing departments for refining sugar-Affination,Carbonation,Decolorization,Boiling,Recovery,and Packaging.Conversion costs are added evenly throughout each process.Data from the month of August for the Recovery Department are as follows: The ending Work-in-Process Inventory is 100% and 85% complete with respect to direct materials and conversion costs,respectively.The weighted-average method is used.How many metric tons of sugar were refined and transferred to the Packaging Department in August?

Which of the following is used to calculate the number of units to account for under the first-in,first-out (FIFO)method of inventory valuation of process costing?