Exam 6: Estimating the Costs of Products and Inventory

Process-costing FIFO is usually applied to both the units entering a department and the units leaving a department.

The ________ approach carries the underallocated or overallocated amounts to overhead accounts in the following year.

Answer the following questions using the information below: Queanbeyan Company incurred fixed manufacturing costs of $7200 during 2018.Other information for 2018 includes: The budgeted denominator level is 800 units. Units produced total 1000 units. Units sold total 950 units. Beginning inventory was zero. The fixed manufacturing cost rate is based on the budgeted denominator level.Manufacturing variances are closed to cost of goods sold. -Woggoon Nature Corporation has provided the following information: Beginuing fixed manufacturing overhead in inventory \ 60000 Ending fixed manufacturing overhead in inventory 45000 Beginuing variable manufacturing overhead in inventory \ 30000 Ending variable manufacturing overhead in inventory 14250 Fixed selling and administrative costs \ 724000 Units produced 5000 units Units sold 4800 units What is the difference between operating profits under absorption costing and variable costing?

Answer the following questions using the information below: The Townsend Tractor Company manufactures small garden tractors on a highly automated assembly line.Its costing system uses two cost categories,direct materials and conversion costs.Each tractor must pass through the Assembly Department and the Testing Department.Direct materials are added at the beginning of the production process. Conversion costs are allocated evenly throughout production.Townsend Tractor uses weighted-average costing. Data for the Assembly Department for April 2018 are: -What amount of direct materials costs are assigned to the ending Work-in-Process account for April?

Answer the following questions using the information below: Hunter Valley Corporation uses a job cost system and has two production departments,A and B.Budgeted manufacturing costs for the year are: Department A Department B Direct materials \ 700000 \ 100000 Direct manufacturing labour \ 200000 \ 800000 Manufacturing overhead \ 600000 \ 400000 The actual material and labour costs charged to Job \#432 were as follows: Total Direct materials: \ 25000 Direct labour: Department A \ 8000 Department B \ 12000 \ 20000 Hunter Valley applies manufacturing overhead costs to jobs on the basis of direct manufacturing labour cost using departmental rates determined at the beginning of the year. -For Department B,the manufacturing overhead allocation rate is:

The Finished Goods Control account consists of actual manufacturing overhead costs rather than allocated manufacturing overhead costs.

The Morgan Models company manufactures replica plastic airplane and motorised vehicle models.During October,the firm's Assembly Department started production of 60 000 models.During the month,the firm completed 66 000 models,and transferred them to the Finishing Department.The firm ended the month with 22 000 models in ending inventory.There were 28 000 models in beginning inventory.All direct materials costs are added at the beginning of the production cycle and conversion costs are added uniformly throughout the production process.The FIFO method of process costing is used by Morgan.Beginning work in process was 25% complete as to conversion costs,while ending work in process was 50% complete as to conversion costs. Beginning inventory: Direct materials costs \ 39200 Conversion costs \ 30800 Manufacturing costs added during the acounting period: Direct materials costs \ 90000 Conversion costs \ 280000 -What is the cost of the goods transferred out during October?

The weighted-average process-costing method calculates the equivalent units by:

The Manufacturing Overhead Control account is the record of:

The production-volume variance only exists under absorption costing and not under variable costing.

Manufacturing overhead costs are allocated to individual job-cost records with the use of indirect-cost rates.

Process costing would be most likely used by a firm that produces heterogeneous products.

Transferred-in costs are treated as if they are a separate type of indirect material added at the beginning of the process.

Maroubra Company has the following balances as of the year ended 31 December 2018.

Equivalent units are calculated separately for each input.

Answer the following questions using the information below: The Townsend Tractor Company manufactures small garden tractors on a highly automated assembly line.Its costing system uses two cost categories,direct materials and conversion costs.Each tractor must pass through the Assembly Department and the Testing Department.Direct materials are added at the beginning of the production process. Conversion costs are allocated evenly throughout production.Townsend Tractor uses weighted-average costing. Data for the Assembly Department for April 2018 are: -What are the equivalent units for direct materials and conversion costs,respectively,for April?

Answer the following questions using the information below: Queanbeyan Company incurred fixed manufacturing costs of $7200 during 2018.Other information for 2018 includes: The budgeted denominator level is 800 units. Units produced total 1000 units. Units sold total 950 units. Beginning inventory was zero. The fixed manufacturing cost rate is based on the budgeted denominator level.Manufacturing variances are closed to cost of goods sold. -The contribution-margin format of the income statement distinguishes manufacturing costs from nonmanufacturing costs.

Give three examples of costs that can be considered indirect for a product and direct for a department. _____________________________________________________________________________________________ ____________________________________________________________________________________________

Answer the following questions using the information below: Alice Opals produces and sells a mantel clock for $100 per unit.In 2010,100 000 clocks were produced and 80 000 were sold.Other information for the year includes: Direct materials \ 30.00 per unit Direct manufacturing labour \ 2.00 per unit Variable manufacturing costs \ 3.00 per unit Sales commissions \ 5.00 per part Fixed manufacturing costs \ 25.00 per unit Administrative expenses, all fixed \ 15.00 per unit -What is the inventoriable cost per unit using variable costing?

The equivalent units are not needed in a weighted-average system,because all costs are just averaged.