Exam 4: How Is Process Costing Used to Track Production Costs

If 10 physical units of product are 30 percent complete at the end of the period,an equivalent of 3 completed units will be used for process costing calculations.

Exhibit 4-2 Chem Company makes chemicals and uses the weighted average process costing method.The company has two processing departments - Mixing and Packaging.They had no beginning inventories for April and the percentages of completion were 50% for direct materials,direct labor,and overhead. Gallons of chemical completed during April 90,000 90,000 Gallons of chemical on hand at April 30 (50\% complete) 8,000 0 Production costs incurred \ 47,000 \ 153,000 -Refer to Exhibit 4-2.What is the cost per gallon for the packaging process?

A job costing system would be appropriate for an oil refinery.

When using a process costing system,product costs are tracked by department rather than by job.

If ending inventory in the Distilling Department consists of 6,000 units which are 100% complete with respect to direct materials and 40% complete with respect to direct labor and overhead,what are the number of equivalent units for direct materials,direct labor,and overhead?

Mathews Company uses the weighted average process costing method.The company had no units in beginning WIP Inventory.Mathews has calculated that 45,000 total equivalent units were completed during the year.If 53,000 units were started in the current period and 10,000 units were in ending WIP Inventory,what percentage of completion existed in the ending inventory units?

Exhibit 4-1 Silva Coporation uses the weighted average process costing method.The Mixing Department at Silva had 17,000 units in beginning inventory.These units contained $70,000 in direct materials,$80,000 in direct labor,and $60,000 in overhead.During the period,the department incurred costs of $320,000 in direct materials,$400,000 in direct labor and $200,000 in overhead and started 80,000 units.Ending inventory consisted of 6,000 units which were 100% complete with respect to direct materials and 50% complete with respect to direct labor and overhead. -Refer to Exhibit 4-1.What is the cost per equivalent unit for direct labor (rounded to the nearest cent)?

Frost Company produces cupcakes in large batches.Three departments are involved in the production process -- Mixing,Baking,and Packaging.Frost uses a process costing system.Assume products with a cost of $9,000 are sold to customers.Which of the following journal entries is needed to record this transaction? a. Cost of Goods Sold 9,000 Finished Goods Inventory 9,000 b. WIP Inventory - Packaging 9,000 Finished Goods Inventory 9,000 c. Finished Goods Inventory 9,000 Sales Revenue 9,000 d. Finished Goods Inventory 9,000 Cost of Goods Sold 9,000 e. $\text {None of the answer choices is correct.}$

When preparing a production cost report using the weighted average process costing method,"units to be accounted for" include:

A company that uses process costing may use several Work-in-Process Inventory accounts.

If a processing department has no beginning WIP Inventory,and the ending WIP Inventory is 100% complete as to material costs,the number of equivalent units for material costs is:

Most companies use either the weighted average or specific identification method to assign costs to inventory in a process costing environment.

Using the weighted average process costing method,which of the following are included in the calculation of "units accounted for" on the departmental production cost report?

The journal entry to record the transfer of units from one processing department to another processing department includes:

The cost per equivalent unit in the production cost report equals the "costs to be accounted for" divided by the number of:

Two important double-checks included in a production cost report are: (1)units to be accounted for matches units accounted for and (2)total costs to be accounted for matches total costs accounted for.

In a process costing system,the department where production begins will never have transferred-in costs from another department.

The following information is available for the current year for Pike company. Number of units in beginning WIP Inventory 12,000 (30\% complete) Number of units started in the current period 160,000 Number of units in the ending WIP Inventory 18,000 (70\% complete) If Pike Company uses the weighted average process costing method,what is the total equivalent completed units transferred out and in WIP Inventory?

Jasper Company uses the weighted average process costing method.The Mixing Department at Jasper had 17,000 units in beginning inventory.These units contained $88,000 in direct materials,$80,000 in direct labor,and $60,000 in overhead.During the period,the department incurred costs of $300,000 in direct materials,$400,000 in direct labor and $200,000 in overhead and started 80,000 units.Ending inventory consisted of 6,000 units which were 100% complete with respect to direct materials and 50% complete with respect to direct labor and overhead.What is the cost per equivalent unit for materials (rounded to the nearest cent)?

In a process costing system,partially completed units in Work-in-Process Inventory are typically converted to equivalent completed units.