Exam 3: Costing Systems- Process Costing

Jackson Electronics, Inc., manufactures a variety of microelectronic component parts and utilizes a process costing system. The following information was provided by the accounting department as of July 31, 20xx: a. Units started during the month of July totaled 118,200. b. Units partially complete as of July 31 equaled 7,400. c. Ending work in process inventory as of July 31, 20x8, was 70 percent complete. d. Direct materials are added at the beginning of the process, and conversion costs are incurred uniformly throughout the process. e. No units were in process on July 1, 20xx. Using the information provided, compute the equivalent units of production for direct materials and conversion costs for July using the FIFO costing method.

In a process costing system, the cost of ending work in process inventory for a period can be verified by reference to supporting analysis in

In a process cost report, accounting for physical units excludes the physical units in beginning inventory to arrive at "units to be accounted for."

It is not necessary to ascertain the portion of ending Work in Process Inventory applicable to direct materials costs versus conversion costs.

Which of the following is not a characteristic of a process costing system?

Use the following data from a company using a process costing system to answer the question below. The company uses average process costing method. - Equivalent units for conversion costs during the month totaled

Separate equivalent units of production usually are calculated for materials and conversion costs.

During October, Department A started 320,000 units of product in a particular manufacturing process. The beginning work in process inventory was 50,000 units, and the ending inventory was 30,000 units. Direct materials are introduced at the start of processing, and beginning and ending inventories are considered to be 50 percent complete with respect to conversion costs. Department A uses the FIFO costing method. - The number of units started and completed during October was

Information for the current month for Process D is shown below. Direct Materials Couversion Costs Beginning work in process inventory \ 6,400 \ 9,600 Current month's costs 31,740 51,100 Equivalent units based on the FIFO costing method 69,000 70,000 Direct materials are added at the beginning of the process. Beginning work in process is 50 percent complete as to conversion costs; ending work in process inventory is 40 percent complete. Determine the cost of ending work in process inventory.

A process costing system is used by companies that manufacture large amounts of similar products or liquid products.

Average cost method assigns an average cost to all products made during an accounting period

The Taylor Company uses a process costing system. Assume that direct materials are added at the beginning of the period and that direct labor and overhead are added continuously throughout the process. The company uses the average costing method. The following data are available for one of its accounting periods: Units Beginning work in process 26,000 (70 percent complete for conversion costs) Units stated 180,000 Units transferred out 191,000 Ending work in process 15,000 (60 percent complete for conversion costs) - Assume that you have calculated a direct materials cost per unit of $5 and a conversion cost per unit of $8. Under this assumption, the ending balance for Work in Process Inventory would be

During March, Department A started 300,000 units of product in a particular production process. The beginning work in process inventory was 50,000 units, and the ending inventory was 40,000 units. Direct materials are introduced at the start of processing, and beginning and ending inventories are considered to be 40 percent complete with respect to conversion costs. Department A uses the FIFO costing method. -The number of equivalent units produced with respect to conversion costs was

The basis used in computing unit cost for the process costing system is made up of certain specific jobs worked on during the fiscal year.

In many instances, direct materials are added at the beginning of the process.

In a process costing system, product costs are traced to individual products.

Measures of equivalent production are necessary in process costing because

When computing the cost per equivalent unit, the FIFO process costing method considers

Equivalent units are defined as the number of units completed and transferred out of work in process inventory during the current period.

The Finishing Department of Garr Company has the following information available for 20xx: Units Conplete Begiming work in process inventory 5,000 40 percent Ending work in process inventory 2,500 80 percent Units completed during 20 32,000 100 percent Assuming that Garr Company uses the FIFO process costing method, what are the equivalent units for conversion costs for 20xx?