Exam 18: Process Costing

For which of the following categories is it not important to know the number of units?

[The following information applies to the questions displayed below.] Note: Materials are all added in the beginning -If direct labor and overhead costs totaled $172,000,what would be the unit cost?

The Work in Process - Assembly account would be credited and the Work in Process - Packaging account would be debited when:

The Finishing Department of Berle Industries works on only one product,and all costs are incurred uniformly while these units remain in the department.On March 1,6,000 units were in process that were 45% completed.An additional 60,000 units were transferred into the Finishing Department during March.At March 31,there were 25,000 units in process that were 75% completed.Compute the equivalent units of production for the Finishing Department during March.

[The following information applies to the questions displayed below.] Sue's Soup Products uses a process costing system with two processing departments: the Mixing and Cooking Department and the Canning Department.Work in process inventories are reduced to zero each month.In March,the Mixing and Cooking Department incurred manufacturing costs of $63,000 to mix 42,000 gallons of soup.The Canning Department incurred manufacturing costs of $9,000.A total of 170,000 cans of soup were transferred to the finished goods warehouse during the month. -The unit cost per gallon of soup transferred to the Canning Department during March was:

The best cost system to use for a company producing a continuous stream of similar items would be a:

Completing 3,000 units,which were each 75% complete at the beginning of the period,represents 2,250 equivalent units of work during the current period.

[The following information applies to the questions displayed below.] Aves Treats,Inc.produces birdseeds.All direct materials used in the production process are added at the beginning of the manufacturing process.Labor and overhead are added evenly thereafter,as each unit is mixed and packaged.Aves Treats uses process costing and had the following unit production information available for the months of June and July: The units remaining in work in process at the end of June were 30% complete.During the month of July,all of the beginning work in process units was completed and the units remaining in work in process at the end of the month were 60% complete. -For the month of July,the number of equivalent units of labor and overhead produced was:

If 8,000 units were in beginning inventory,26,000 units were started,and 6,000 units were in the ending inventory,how many units were transferred out?

Debiting Work-in-Process in Department Two and crediting Work-in-Process in Department One represents costs transferred from Department Two to Department One.

[The following information applies to the questions displayed below.] During May,the number of equivalent units of materials applied to units produced by Department Q totaled 48,000,computed as follows: beginning inventory,5,000 equivalent units;units started and completed in May,37,000 equivalent units;and ending inventory,6,000 equivalent units. -Assuming that the cost of direct materials used by Department Q in May was $440,000,the materials cost assigned to unfinished units at May 31 would be: (Do not round intermediate calculations. )

A process costing system is suitable for a company with a large volume of standard products produced on a relatively continuous basis,for example,golf balls or petroleum.

If 80% of all inventory was sold at $32 per unit and 3,500 units were sold,what is the cost of the finished goods inventory at year-end?

During August,Department Z started and completed 90,000 units and also finished 18,000 units that were 75% completed on July 31.On August 31,Department Z's ending inventory consisted of 26,000 units that were 45% completed.All manufacturing costs are incurred at a uniform rate throughout Department Z's production process.The number of equivalent units of production for Department Z during August is:

During July,the equivalent units of direct materials added to the product worked on by Department A amounted to a total of 90,000 applied as follows: beginning inventory,20,000 units;units started and completed in July,60,000 units;and ending inventory,10,000 units.Assuming that the cost of direct materials requisitioned by the department in July was $135,000;the amount of the materials cost to be assigned to the ending inventory would be: (Do not round intermediate calculations. )

[The following information applies to the questions displayed below.] Evans Products uses a process costing system with two processing departments: the Mixing Department and the Finishing Department.In June,unit costs incurred by the Mixing Department amounted to $4.00 per unit.Unit costs transferred to the finished goods warehouse during the month amounted to $22.Work-in-process inventories are reduced to zero each month. -The transfer of 35,000 units to the Finishing Department in June required:

Job order and process costing systems There are two distinct types of cost accounting systems: job order costing systems and process costing systems.How does management decide whether to use a job order costing system or a process costing system in any given manufacturing situation? Explain briefly.

Department X of a manufacturing company works on only one product,and all costs are incurred uniformly as the product goes along the assembly line.The 8,000 units in process on December 1 were 60% completed.An additional 40,000 units were placed in production during December.At December 31,the 10,000 units in process were 60% completed.The equivalent units of production during December amounted to:

In a process costing system that uses equivalent units of production,the per-unit cost of direct materials equals the total cost of materials used in the current month divided by the number of units completed and transferred during the current month.

Conversion costs include direct labor and direct materials associated with converting units,so that they can be transferred out of Work in Process.