Exam 6: Process Costing

Beginning inventory for the month contained 12,000 units that were 60% complete with respect to materials.During the month,80,000 units were completed and transferred out.Ending inventory contained 6,000 units,30% complete with respect to materials.What would be the weighted average equivalent units of production for materials for the month?

The following amounts were selected from the production report of Doggie Donuts Corporation: Doggie Donuts uses the weighted average method in preparing its production reports.What must Doggie Donuts' total production cost to be accounted for have been? Actual units in production 55,000 Equival ent units (materials) 55,000 Equival ent units (conversion) 45,000 Cost per equivalent unit (materials) \ 1.50 Cost per equivalent unit (conversion) \ 1.10

Describe how process costing for services differs from process costing for manufactured goods.

The weighted average costing method combines beginning inventory costs and work done with current period costs and work to calculate this period's unit cost.

Door Specialists make a product that passes through two processes. During March, the first department transferred 50,000 units to the second department. The cost of the units transferred was $75,000. Materials are added uniformly in the second process. The following information was provided about the second department's operations during March: Units, beginning work in process 10,000 Units, ending work in process 13,000 -Refer to the Figure.How many units were started in Door Specialists second department during March?

A production report contains information on costs transferred in from prior departments as well as costs added in the department such as direct materials,direct labour,and overhead.

What two categories of completed units are needed in the FIFO method so that each category can be costed correctly?

Zero beginning and ending work-in-process inventories leads to much of the complication surrounding process costing.

Which step is physical flow analysis in the general pattern of a process-costing production report?

Cara,Inc.manufactures a product that passes through two processes: mixing and packaging.All manufacturing costs are added uniformly in the mixing department. Information for the mixing department for April follows: During April,90,000 units were completed and transferred to packaging. The following costs were incurred by the mixing department during April: Work in process, April 1 Units (60\% complete) 5,000 Direct materials \ 40,000 Direct labour \ 50,000 Overhead \ 5,000 At April 30,15,000 units that were 20% complete remained in the mixing department. Use the weighted average method and round unit costs to two decimal places. Required: Direct materials \ 280,000 Direct labour 190,000 Overhead 75,000 A. Determine equivalent units of production for April. B. Determine April's total costs to account for. C. Determine total cost per equivalent unit of production. D. Determine the cost of goods transferred to the packaging department. E. Determine the cost of April's ending work in process for the mixing department.

LuLu, Inc. manufactures a product that passes through two processes: mixing and moulding. All manufacturing costs are added uniformly in the mixing department. Information for the mixing department for May follows: During May, 25,000 units were completed and transferred to the moulding department. The following costs were incurred by the mixing department during May: Work in process, May 1: Units (35\% complete) 5,000 Direct materials \ 24,000 Direct labour \ 30,000 Overhead \ 10,000 By May 31, 2,500 units that were 80% complete remained in the mixing department. LuLu uses the weighted average method. Direct materials \ 90,000 Direct labour 120,000 Overhead 30,000 -Refer to the Figure.What would be LuLu's equivalent units of production when using the weighted average method?

Choose the most likely used costing system for the industries listed below. -Costing system used by a vitamin manufacturer

The usual approach is to treat transferred-in goods as a separate conversion category when calculating equivalent units.

Everything Company manufactures a product that passes through two processes.The following information is available for the first department for August. All materials are added at the beginning of the process. Beginning work in process consisted of 20,000 units that were 80% complete with respect to conversion. Ending work in process 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. B. Compute equivalent units using the FIFO method.

Which statement is a characteristic of process accounting?

The following information is available for Department ABC for the month of September: Materials are added at the beginning of the process. (Round unit costs to two decimal places.) -Refer to the Figure.What would be Department ABC's cost per equivalent unit of production for materials when using the FIFO method?

Similar percentage completion figures for manufacturing inputs pose a problem for the calculation of equivalent units,unit cost,and valuation of ending work in process.

Select the appropriate definition for each of the items listed below. -The costs transferred from a prior process to a subsequent process

Match the five steps involved in creating the department production report with the steps below in the proper order. -Physical flow analysis

Nichola,Inc.manufactures products that pass through two processes.The company uses the weighted average method to compute unit costs.During April,equivalent units were computed as follows: Cost was added as follows: Required: Materials \ 73,750 Conversion cost 57,200 Total cost \ 130,950 A. Determine the cost of the goods transferred out. B. Determine the cost of ending work in process. Determine the cost of the goods transferred out if materials in ending work in process had C. been $90 \%$ complete and conversion in ending work in process had been $70 \%$ complete. Round costs per unit to two decimal places if necessary.