Exam 6: Process Cost Accounting Additional Procedures

During June, Birch Bay Company's Department B equivalent unit product costs computed under the FIFO method were as follows: Materials are introduced at the end of the process in Department B. There were 4,000 units (60 % complete as to conversion costs) in work in process at June 30. The total costs assigned to the June 30 work in process inventory should be:

The following information is available for the month of August from the First department of the Twigg Corporation: Materials are added in the beginning of the process in the First department. Using the average cost method, what are the equivalent units of production for the month of August?

Materials are added at the start of the process in McKay Company's blending department, the first stage of the production cycle. The following information is available for the month of July: Under McKay's cost accounting system, the costs incurred on the lost units are absorbed by the remaining good units. Using the average cost method, what are the equivalent units for the materials unit cost calculation?

Which of the following is not an acceptable method for accounting for by-products in a joint manufacturing process?

Boyce Company manufactures chemicals. Chemical agent ABX is refined in the Refining department and, after it is transferred to the Mixing department, a reactive agent is added to it. In May, 25,000 gallons of ABX having a cost of $100,000 were transferred from the refining to the Mixing department where 15,000 gallons of the reactive agent were added. When calculating the inventory costs in the Mixing department, what will the cost per unit relating to gallons transferred in from the Refining department be?

The average cost method of process costing differs from the FIFO method of process costing in that the average cost method:

Logan, Inc., had 9,000 units of work in process in Department M on March 1 that were 50 percent complete as to conversion costs. Materials are introduced at the beginning of the process. During March, 18,000 units were started, 20,000 units were completed, and there were 1,000 units of normal losses. Logan had 6,000 units of work in process at March 31 that were 60 percent complete as to conversion costs. Under Logan's cost accounting system, lost units reduce the number of units over which total cost can be spread. Using the average cost method, what were the equivalent units for March for conversion costs?

The following information is available for the month of April from the First department of the Armque Corporation: Materials are added in the beginning of the process in the First department. Using the average cost method, what are the equivalent units of production for the month of April?

Information concerning Department A of Ali Company for the month of June is as follows: All materials are added at the beginning of the process. Using the average cost method, the cost (rounded to two places) per equivalent unit for materials for June is:

When two products are produced during a common process, what is the factor that determines whether the products are joint products or one principal product and a by-product?

Regina Manufacturing uses the FIFO method of process costing. The production report for the Curing Department, where the materials are added at the beginning of the period, for September was as follows: The number of equivalent units for conversion costs during the period was:

If the amount of loss in a manufacturing process is abnormal, it should be classified as a:

In a process cost system, how is the unit cost affected in a production cost report when materials are added in a department subsequent to the first department and the added materials result in additional units?

Kyle, Inc., instituted a new process in October. During October, 18,000 units were started in Department A. Of the units started, 2,000 were lost in the process, 12,000 were transferred to Department B, and 4,000 remained in work in process at October 31. The work in process at October 31 was 100 percent complete as to material costs and 15% complete as to conversion costs. Material costs of $78,400 and conversion costs of $52,920 were charged to Department A in October. What were the total costs transferred to Department B and assigned to ending work in process using the average cost method?

Under which of the following conditions will the first-in, first-out method of process costing produce the same cost of goods manufactured amount as the average cost method?

Budde Chemicals produces two industrial chemical compounds, X15 and Z24, from the same process, which last year, cost $300,000. Budde produced 15,000 gallons of X15, which sells for $40 per gallon and 45,000 gallons of Z24, which sells for $20 per gallon. After the split-off point, X15 required additional processing costing $200,000 to make it salable. Using the adjusted sales method, how much of the joint cost should be allocated to X15?

If two or more products share a common process before they are separated, the joint costs should be allocated in a manner that:

Howard Poster Incorporated had 12,000 units of work in process in Department A on October 1. These units were 60 percent complete as to conversion costs. Materials are added in the beginning of the process. During the month of October, 38,000 units were started and 40,000 units were completed. Howard had 10,000 units of work in process on October 31. These units were 75 percent complete as to conversion costs. 1) Compute the equivalent units for materials and conversion costs for the month of October using the FIFO method. 2) Using the average cost method determine the equivalent units for materials and conversion costs for the month of October.

Jim Davis Company processes hogs into three products, chops, bacon and sausage. Production and selling price data follow: Bacon was smoked, sliced and packaged after the split-off point. The cost incurred for these processes was $100,000. Sausage was ground and formed into patties after the split-off. This process cost $60,000. If joint processing costs were $1,500,000, calculate the total cost of each product using the adjusted sales value method.

Budde Chemicals produces two industrial chemical compounds, X15 and Z24, from the same process, which last year, cost $300,000. Budde produced 15,000 gallons of X15, which sells for $40 per gallon and 45,000 gallons of Z24, which sells for $20 per gallon. Using the relative sales method, how much of the joint cost should be allocated to X15?