Exam 16: Process Costing and Analysis

Dazzle,Inc.produces beads for jewelry making use.The following information summarizes production operations for June. -The journal entry to record June production activities for direct labor usage is:

Richards Corporation uses the weighted-average 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 conversion.

If indirect materials costing $37,500 that were not clearly linked with any specific production process or department were used during a reporting period,the following journal entry would be recorded in the process costing system:

At the beginning of the month,the Forming Department of Martin Manufacturing had 10,000 units in inventory,30% complete as to materials,and 10% complete as to conversion.During the month the department started 60,000 units and transferred 62,000 units to the next manufacturing department.At the end of the month,the department had 8,000 units in inventory,80% complete as to materials and 60% complete as to conversion.If Martin Manufacturing uses the FIFO method of process costing,compute the equivalent units for materials and conversion respectively for the Forming Department.

Dazzle,Inc.produces beads for jewelry making use.The following information summarizes production operations for June. -The journal entry to record June production activities for overhead allocation is:

The fourth step in accounting for production activity in a period is to prepare a cost reconciliation,which ________ and ________ costs.

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 equivalent units of conversion.

Grayson Company had 8,700 units in beginning inventory with accumulated costs for direct materials of $17,900,$16,500 direct labor,and $13,200 of overhead.During July,the company completed and transferred 50,000 units to finished goods.Costs incurred in the current period included $45,000 of direct materials,$58,500 of direct labor,and $46,800 of factory overhead.Ending inventory consisted of 12,000 units which were 90% complete with respect to materials and 50% complete with respect to labor and overhead.Compute the value assigned to ending inventory based on the weighted average method of inventory costing.

All of the following are true about using a predetermined overhead rate to apply overhead except,

A materials consumption report is used instead of materials requisitions in companies where materials move continuously through the manufacturing process.

Process and job order manufacturing operations both combine materials,labor,and overhead items in the process of producing products.

Port Manufacturing Company uses a process costing system.Materials are added at the beginning of the process.Direct labor and overhead are added evenly throughout the process.The company uses monthly reporting periods for its weighted-average process costing.The following are the operating and cost data information for October. The October 1 beginning Work in Process Inventory consisted of 20,000 units.The costs for this inventory are $82,500 of direct materials,$24,400 of direct labor,and $48,800 of factory overhead.Factory overhead is applied at 200% of direct labor cost. In addition to the beginning inventory costs,the company issued the following costs into Work in Process Inventory; direct materials,$240,000; direct labor,$68,000; factory overhead,$136,000. During October,the company completed and transferred 60,000 units of its product to finished goods.At the end of the month,the Work in Process inventory consisted of 15,000 units that were 40% complete with respect to direct labor and factory overhead and 100% complete with respect to materials. Prepare the company's process cost summary for October using the weighted average method.

A company uses the FIFO method for inventory costing.At the beginning of a period,the production department had 20,000 units in beginning Work in Process inventory which were 40% complete; the department completed and transferred 165,000 units.At the end of the period,22,000 units were in the ending Work in Process inventory and are 75% complete.Compute the number of equivalent units produced by the department.

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 conversion.

Process costing typically uses only one Work in Process Inventory account,while job order costing typically uses a separate Work in Process Inventory account for each department.

The use of process costing is of little benefit to a service provider.

Process costing systems are commonly used by companies that manufacture standardized products by passing them through a series of manufacturing steps.

Clarksen Company uses a process costing system.The company requisitioned $93,000 of materials for Department A and $67,000 of materials for Department D.The entry to record the use of the direct materials by these two departments is:

At the beginning of the month,the Painting Department of Skye Manufacturing had 20,000 units in inventory,70% complete as to materials,and 20% complete as to conversion.The cost of the beginning inventory,$28,650,consisted of $22,400 of material costs and $6,250 of conversion costs.During the month the department started 115,000 units and transferred 120,000 units to the next manufacturing department.Costs added in the current month consisted of $229,600 of materials costs and $540,500 of conversion costs.At the end of the month,the department had 15,000 units in inventory,40% complete as to materials and 10% complete as to conversion.If Skye Manufacturing uses the weighted average method of process costing,compute the costs per equivalent unit of materials and conversion respectively for the Painting Department.

Sutton Company uses a process costing system.In May,80,000 units were finished and transferred to finished goods.Ending Work in Process included 20,000 unfinished units 30% complete.Calculate the equivalent units of production for the year using the weighted average method.