Exam 16: Process Costing and Analysis

A process cost summary for a production department accounts for all costs assigned to that department during the period plus costs that were in the department's Work in Process Inventory account at the beginning of the period.

In a process operation,all labor that is used exclusively by a single production department is considered direct labor.

The Finishing Department transferred out completed units with a cost of $74,000.This transfer should be recorded with the following entry:

When raw materials are purchased on account for use in a process costing system,the corresponding journal entry that should be recorded will include:

Sparky Corporation uses the weighted-average method of process costing.The following information is available for February in its Molding Department: Units: Beginning Inventory: 25,000 units,100% complete as to materials and 55% complete as to conversion. Units started and completed: 110,000. Units completed and transferred out: 135,000. Ending Inventory: 30,000 units,100% complete as to materials and 30% complete as to conversion. Costs: Costs in beginning Work in Process - Direct Materials: $43,000. Costs in beginning Work in Process - Conversion: $48,850. Costs incurred in February - Direct Materials: $287,000. Costs incurred in February - Conversion: $599,150. -Calculate the equivalent units of materials.

A production department's output for the most recent month consisted of 10,000 units completed and transferred to the next stage of production and 10,000 units in ending Work in Process inventory.The units in ending Work in Process inventory were 50% complete with respect to both direct materials and conversion costs.There were 1,000 units in beginning Work in Process inventory,and they were 70% complete with respect to both direct materials and conversion costs.Calculate the equivalent units of production for the month,assuming the company uses the weighted average method.

Richards Corporation uses the FIFO method of process costing.The following information is available for October in its Fabricating Department: Units: Beginning Inventory: 80,000 units,60% complete as to materials and 20% complete as to conversion. Units started and completed: 250,000. Units completed and transferred out: 330,000. Ending Inventory: 30,000 units,40% complete as to materials and 10% complete as to conversion. Costs: Costs in beginning Work in Process - Direct Materials: $37,200. Costs in beginning Work in Process - Conversion: $79,700. Costs incurred in October - Direct Materials: $646,800. Costs incurred in October - Conversion: $919,300. -Calculate the cost per equivalent unit of materials.

Luker Corporation uses a process costing system.The company had $160,500 of beginning Finished Goods Inventory on October 1.It transferred in $837,000 of units completed during the period.The ending Finished Goods Inventory balance on October 31 was $158,200.The entry to account for the cost of goods manufactured during October is:

Equivalent units of production are always the same as the total number of physical units finished during the period.

Equivalent units of production is the number of units that could have been started and completed given the costs incurred during the period.

Which of the following products is most likely to be produced in a process operation?

Manufacturers that utilize process operations produce large quantities of identical products.

The following data is available for Donaldson Corp.for the current year: Calculate the equivalent units of production for the year using the weighted average method.

In process costing,a ________ is used to apply factory overhead.

In a process costing system,the purchase of raw materials is credited to Raw Materials Inventory.

Describe the flow of overhead costs in a process costing system,including accounts used.

If a department that applies 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 direct labor,it must add 12,500 equivalent units of direct materials and 20,000 equivalent units of direct labor to complete them.

Hybrid systems contain features of both process and job order operations.

During March,the production department of a process operations system completed and transferred to finished goods 25,000 units that were in process at the beginning of March and 110,000 units that were started and completed in March.March's beginning inventory units were 100% complete with respect to materials and 55% complete with respect to conversion.At the end of March,30,000 additional units were in process in the production department and were 100% complete with respect to materials and 30% complete with respect to conversion.Compute the number of equivalent units with respect to both materials and conversion respectively for March using the weighted-average method.

Andrews Corporation uses the weighted-average method of process costing.The following information is available for February in its Polishing Department: The cost per equivalent unit of production for direct materials is: