Question 1

The number of possible combinations of product flows and production processes is limitless.

Accepted Answer

A) True 
 B)False

Question 2

Use the following data from a company using a process costing system to answer the question(s) below.  
 The FIFO process costing method is used by the company.
- 
Equivalent units for conversion costs during the month totaled

Accepted Answer

A)  8,020. 
B)  7,780. 
C)  6,980. 
D)  5,980. 
A)  8,020. 
B)  7,780. 
C)  6,980. 
D)  5,980.

Question 3

Use the following information to perform the calculations requested below, assuming that the average costing approach to a process costing system is being used.
Beginning work in process inventory: 6,000 units, 100 percent complete as to direct materials, 75 percent complete as to conversion costs
Ending work in process inventory: 18,000 units, 100 percent complete as to direct materials, 65 percent complete as to conversion costs
Units started during the month: 44,000
a. Calculate units completed and transferred out during the month.
b. Calculate units to be accounted for during the month.
c. Calculate equivalent units for conversion costs.
d. Calculate equivalent units for direct materials.

Accepted Answer

@#IMG-DLM&

a. 32,00

Question 4

Average costing method treats the ending inventory exactly in the same way as the FIFO costing method.

Accepted Answer

A) True 
 B)False

Question 5

In a process costing system, some of the increases to Department B's Work in Process Inventory account would come from Department A's

Accepted Answer

A)  Finished Goods Inventory account. 
B)  Materials Inventory account. 
C)  Cost of Goods Sold account. 
D)  Work in Process Inventory account. 
A)  Finished Goods Inventory account. 
B)  Materials Inventory account. 
C)  Cost of Goods Sold account. 
D)  Work in Process Inventory account.

Question 6

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: $\begin{array}{|l|l|l|}
\hline & \text { Units } & \
\hline \text { Beginning work in process } & 26,000 & \text { (70 percent complete for conversion costs) } \
\hline \text { Units started } & 180,000 & \
\hline \text { Units transferred out } & 191,000 & \
\hline \text { Ending work in process } & 15,000 & \text { (60 percent complete for conversion costs) } \
\hline & &
\end{array}$
-
 Equivalent units for direct materials are

Accepted Answer

A)  180,000. 
B)  206,000. 
C)  176,000. 
D)  191,000. 
A)  180,000. 
B)  206,000. 
C)  176,000. 
D)  191,000.

Question 7

Direct materials costs and conversion costs for the current period on a process cost report are divided by their respective units of equivalent production to arrive at the

Accepted Answer

A)  ending inventory unit cost. 
B)  transferred-in cost per unit. 
C)  beginning inventory cost per unit. 
D)  cost per equivalent unit. 
A)  ending inventory unit cost. 
B)  transferred-in cost per unit. 
C)  beginning inventory cost per unit. 
D)  cost per equivalent unit.

Question 8

The equivalent units of production must be computed before the value of ending inventory can be determined in a process costing system.

Accepted Answer

A) True 
 B)False

Question 9

Equivalent production is also called

Accepted Answer

A)  conversion costs. 
B)  completed work cell unit. 
C)  equivalent units. 
D)  percentage-of-completion. 
A)  conversion costs. 
B)  completed work cell unit. 
C)  equivalent units. 
D)  percentage-of-completion.

Question 10

One reason for preparing a process cost report for a particular department is to determine the amount of costs to transfer to the next department or to the Finished Goods Inventory account at the end of the period.

Accepted Answer

A) True 
 B)False

Question 11

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 equivalent units for conversion costs was

Accepted Answer

A)  345,000. 
B)  330,000. 
C)  360,000. 
D)  375,000. 
A)  345,000. 
B)  330,000. 
C)  360,000. 
D)  375,000.

Question 12

Which of the following statements is true?

Accepted Answer

A)  The Work in Process Inventory account is the focal point of process costing. 
B)  Labor costs are accounted for differently from overhead costs in a process costing system. 
C)  Equivalent units usually are computed for direct materials and overhead combined. 
D)  To compute unit costs using the FIFO process costing approach, total costs of direct materials, direct labor, and overhead that have been accumulated in the Work in Process Inventory account or accounts are divided by the units worked on during the period. 
A)  The Work in Process Inventory account is the focal point of process costing. 
B)  Labor costs are accounted for differently from overhead costs in a process costing system. 
C)  Equivalent units usually are computed for direct materials and overhead combined. 
D)  To compute unit costs using the FIFO process costing approach, total costs of direct materials, direct labor, and overhead that have been accumulated in the Work in Process Inventory account or accounts are divided by the units worked on during the period.

Question 13

Direct materials for 6,800 units were added at the beginning of the second process during November. During the month, 7,100 units were completed and transferred to the third process. On November 1, there were 600 units in beginning inventory, and on November 30, there were 300 units still remaining in the process. Compute the equivalent units for direct materials for the second process for November using the FIFO costing method.

Accepted Answer

A)  7,400 
B)  6,800 
C)  7,100 
D)  7,700 
A)  7,400 
B)  6,800 
C)  7,100 
D)  7,700

Question 14

Because process costing is normally associated with a continuous production flow, products that are in process at the beginning of the period are assumed to be the first products completed during the current period.

Accepted Answer

A) True 
 B)False

Question 15

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 direct materials during the month totaled

Accepted Answer

A)  6,400. 
B)  8,600. 
C)  6,600. 
D)  7,400. 
A)  6,400. 
B)  8,600. 
C)  6,600. 
D)  7,400.

Question 16

Regardless of beginning inventory levels, the unit costs are determined by dividing the equivalent units by the total costs of the period.

Accepted Answer

A) True 
 B)False

Question 17

Why are equivalent units of production used in process costing?

Accepted Answer

A)  To allocate overhead costs 
B)  To determine the value of work in process and finished goods inventories 
C)  To aid in determining costs per unit and costs of inventories in each process 
D)  To determine the cost per finished unit 
A)  To allocate overhead costs 
B)  To determine the value of work in process and finished goods inventories 
C)  To aid in determining costs per unit and costs of inventories in each process 
D)  To determine the cost per finished unit

Question 18

The number of equivalent units produced for direct materials cost using the FIFO costing procedure is the sum of the units in beginning work in process inventory, units started and completed during the period, and the productive effort applied to ending work in process inventory.

Accepted Answer

A) True 
 B)False

Question 19

The most commonly used method to assign costs to products in process costing is the FIFO costing method.

Accepted Answer

A) True 
 B)False

Question 20

The product unit cost is the sum of the cost elements added in all production department processes.

Accepted Answer

A) True 
 B)False

The number of possible combinations of product flows and production processes is limitless.

Use the following data from a company using a process costing system to answer the question(s) below. The FIFO process costing method is used by the company. - Equivalent units for conversion costs during the month totaled

Average costing method treats the ending inventory exactly in the same way as the FIFO costing method.

In a process costing system, some of the increases to Department B's Work in Process Inventory account would come from Department A's

Direct materials costs and conversion costs for the current period on a process cost report are divided by their respective units of equivalent production to arrive at the

The equivalent units of production must be computed before the value of ending inventory can be determined in a process costing system.

Equivalent production is also called

One reason for preparing a process cost report for a particular department is to determine the amount of costs to transfer to the next department or to the Finished Goods Inventory account at the end of the period.

Which of the following statements is true?

Because process costing is normally associated with a continuous production flow, products that are in process at the beginning of the period are assumed to be the first products completed during the current period.

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 direct materials during the month totaled

Regardless of beginning inventory levels, the unit costs are determined by dividing the equivalent units by the total costs of the period.

Why are equivalent units of production used in process costing?

The number of equivalent units produced for direct materials cost using the FIFO costing procedure is the sum of the units in beginning work in process inventory, units started and completed during the period, and the productive effort applied to ending work in process inventory.

The most commonly used method to assign costs to products in process costing is the FIFO costing method.

The product unit cost is the sum of the cost elements added in all production department processes.

The Changing Business Environment - a Managers Perspective

Costing Systems- Job Order Costing

Value-Based Systems- Abm and Lean

Cost Behavior Analysis

The Budgeting Process

Performance Management and Evaluation

Standard Costing and Variance Analysis

Short Run Decision Analysis

Capital Investment Analysis

Pricing Decisions, Incl Target Costing and Transfer Pricing

Quality Management and Measurement

Financial Analysis of Performance

Filters

Exam 3: Costing Systems- Process Costing

The number of possible combinations of product flows and production processes is limitless.

Use the following data from a company using a process costing system to answer the question(s) below. The FIFO process costing method is used by the company. - Equivalent units for conversion costs during the month totaled

Average costing method treats the ending inventory exactly in the same way as the FIFO costing method.

In a process costing system, some of the increases to Department B's Work in Process Inventory account would come from Department A's

Direct materials costs and conversion costs for the current period on a process cost report are divided by their respective units of equivalent production to arrive at the

The equivalent units of production must be computed before the value of ending inventory can be determined in a process costing system.

Equivalent production is also called

One reason for preparing a process cost report for a particular department is to determine the amount of costs to transfer to the next department or to the Finished Goods Inventory account at the end of the period.

Which of the following statements is true?

Because process costing is normally associated with a continuous production flow, products that are in process at the beginning of the period are assumed to be the first products completed during the current period.

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 direct materials during the month totaled

Regardless of beginning inventory levels, the unit costs are determined by dividing the equivalent units by the total costs of the period.

Why are equivalent units of production used in process costing?

The number of equivalent units produced for direct materials cost using the FIFO costing procedure is the sum of the units in beginning work in process inventory, units started and completed during the period, and the productive effort applied to ending work in process inventory.

The most commonly used method to assign costs to products in process costing is the FIFO costing method.

The product unit cost is the sum of the cost elements added in all production department processes.

The Changing Business Environment - a Managers Perspective

Costing Systems- Job Order Costing

Value-Based Systems- Abm and Lean

Cost Behavior Analysis

The Budgeting Process

Performance Management and Evaluation

Standard Costing and Variance Analysis

Short Run Decision Analysis

Capital Investment Analysis

Pricing Decisions, Incl Target Costing and Transfer Pricing

Quality Management and Measurement

Financial Analysis of Performance

Filters