Question 1

The amount of equivalent production units for direct materials is always the same as that for conversion costs.

Accepted Answer

A) True 
 B)False

Question 2

Use the following information to perform the calculations requested below, assuming that the FIFO 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 started and completed 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

The answer of Use the following information to perform the...

Question 3

A company should use process costing rather than job order costing if

Accepted Answer

A)  production is only partially completed during the accounting period. 
B)  the product is produced in batches only as orders are received. 
C)  the product is composed of mass-produced homogeneous units. 
D)  the product goes through single stage of production. 
A)  production is only partially completed during the accounting period. 
B)  the product is produced in batches only as orders are received. 
C)  the product is composed of mass-produced homogeneous units. 
D)  the product goes through single stage of production.

Question 4

Under the average costing method in process costing system, the costs in beginning inventory are combined with current period costs to compute an average product unit cost.

Accepted Answer

A) True 
 B)False

Question 5

The Bakersfield Company has the following information available: $\begin{array}{|l|l|l|}
\hline & \text { Costs from Begiuning Inventory } & \text { Costs from Current Period } \
\hline \text { Direct materials } & \$ 3,650 & \$ 31,620 \
\hline \text { Conversion costs } & 9,120 & 143,100 \
\hline 
\end{array}$
 At the beginning of the period, there were 800 units in process that were 60 percent complete as to conversion costs and 100 percent complete as to direct materials costs. During the current period, 5,800 units were started and completed. Ending inventory contained 400 units that were 60 percent complete as to conversion costs and 100 percent complete as to direct materials costs. (Assume that the company uses the FIFO process costing method.)
-
The equivalent units of production for direct materials and conversion costs, respectively, were

Accepted Answer

A)  6,200 for direct materials and 6,360 for conversion costs. 
B)  5,400 for direct materials and 6,520 for conversion costs. 
C)  6,200 for direct materials and 5,960 for conversion costs. 
D)  7,000 for direct materials and 6,520 for conversion costs. 
A)  6,200 for direct materials and 6,360 for conversion costs. 
B)  5,400 for direct materials and 6,520 for conversion costs. 
C)  6,200 for direct materials and 5,960 for conversion costs. 
D)  7,000 for direct materials and 6,520 for conversion costs.

Question 6

In process costing, all costs incurred by a department or production process are divided by the equivalent units produced during the period to determine the average cost per unit produced.

Accepted Answer

A) True 
 B)False

Question 7

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 FIFO costing method. The following data are available for one of its accounting periods: $\begin{array}{|l|l|l|}
\hline & \text { Units } & \
\hline \text { Begining work in process } & 26,000 & \text { (70 percent complete for conversion costs) } \
\hline \text { Units stented } & 180,000 & \
\hline \text { Units transferred out } & 191,000 & \
\hline \text { Endling work in process } & 15,000 & \text { (60 percent complete for conversion costs) } \

\hline
\end{array}$
-
 Assume that you have calculated a direct materials cost per unit of $4 and a conversion cost per unit of $7. Under this assumption, the ending balance for Work in Process Inventory would be

Accepted Answer

A)  $82,000. 
B)  $165,000. 
C)  $99,000. 
D)  $123,000. 
A)  $82,000. 
B)  $165,000. 
C)  $99,000. 
D)  $123,000.

Question 8

Equivalent units of production usually are determined for

Accepted Answer

A)  direct materials costs only. 
B)  direct materials and conversion costs. 
C)  direct materials and direct labor costs only. 
D)  conversion costs only. 
A)  direct materials costs only. 
B)  direct materials and conversion costs. 
C)  direct materials and direct labor costs only. 
D)  conversion costs only.

Question 9

Montell Inc. produces a variety of outdoor equipment products and utilizes a process costing system. The following information was provided by the accounting department as of March 31, 20xx:
a. Units started during the month of March totaled 314,000.
b. Units partially complete as of March 31 equaled 76,000.
c. Ending work in process inventory as of March 31, 20xx, was 80 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 March 1, 20xx.
Using the information provided, compute the equivalent units of production for direct materials and conversion costs for the month ended March 31, 20xx, assuming a FIFO costing flow.

Accepted Answer

The answer of Montell Inc. produces a variety of outdoor...

Question 10

Under the FIFO cost flow assumption, separate unit cost analyses are not used for each accounting period because costs of different periods are averaged.

Accepted Answer

A) True 
 B)False

Question 11

Use the following data from a company using a process costing system to answer the question below.   The company uses average process costing method.
-
Units completed and transferred out of the department during the month totaled

Accepted Answer

A)  12,800. 
B)  12,400. 
C)  14,800. 
D)  10,400. 
A)  12,800. 
B)  12,400. 
C)  14,800. 
D)  10,400.

Question 12

Regardless of the cost approach used, in a process costing system, costs attached to units in beginning inventory are included in the computation of costs per equivalent unit.

Accepted Answer

A) True 
 B)False

Question 13

Production has just been completed for January 20xx by Colombo, Inc. The company utilizes a process costing system, and the following accounting and operating information was obtained from company records:
a. Beginning work in process inventory consisted of units totaling 8,200 that were 60 percent complete as of January 1, 20xx (all direct materials were added to the units at the beginning of the production process that took place in the preceding month).
b. 260,000 units were started during January.
c. At the end of the month, 22,400 units were in work in process inventory and were 100 percent complete with respect to direct materials and 40 percent complete with respect to conversion costs.
From the figures shown above, and assuming a FIFO costing flow, prepare in good form a schedule of equivalent production for the month ended January 31, 20xx.

Accepted Answer

The answer of Production has just been completed for January...

Question 14

Trunkey Products, Inc., uses a process costing system and has just completed production for the month of November 20xx. The following production data were obtained from the accounting records:
a. Units in beginning inventory totaled 6,800 and were 30 percent complete as of November 1 (all direct materials were added to these products in the preceding month).
b. During the period, 156,200 units were started.
c. 19,200 units were partially completed as of November 30, 20xx.
d. Ending work in process inventory was 40 percent complete at month end.
From the data given, compute the equivalent units of production for direct materials and conversion costs for the month ended November 30, 20xx, assuming the company follows average costing method.

Accepted Answer

The answer of Trunkey Products, Inc., uses a process costing...

Question 15

Weston Company uses the FIFO method in its process costing system. The first processing department, the Welding Department, started the month with 18,000 units in its beginning work in process inventory that were 50 percent complete with respect to conversion costs. The conversion costs in the beginning work in process inventory were $52,200. An additional 55,000 units were started into production during the month. There were 16,000 units in the ending work in process inventory of the Welding Department that were 20 percent complete with respect to conversion costs. A total of $284,160 in conversion costs were incurred in the department during the month. What would be the cost per equivalent unit for conversion costs for the month on the department's process cost report? (Round to three decimal places.)

Accepted Answer

A)  $5.550 
B)  $4.608 
C)  $5.800 
D)  $5.167 
A)  $5.550 
B)  $4.608 
C)  $5.800 
D)  $5.167

Question 16

In a process costing system, the amount of total costs to be accounted for is made up of direct materials and conversion costs incurred during the current period plus those costs included in the beginning Work in Process Inventory account.

Accepted Answer

A) True 
 B)False

Question 17

Bakersfield Company manufactures a variety of chips and utilizes a process costing system. The following information was provided by the accounting department as of May 31, 20xx:
a. Units started during the month of May totaled 35,000.
b. Units partially complete as of May 31 equaled 8,400.
c. Ending work in process inventory as of May 31, 20xx, was 75 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 May 1, 20xx.
Using the information provided, compute the equivalent units of production for direct materials and conversion costs for the month ended May 31, 20xx, assuming a FIFO costing flow.

Accepted Answer

The answer of Bakersfield Company manufactures a variety of chips...

Question 18

Information for the current month for Process 5 is shown below. $\begin{array}{|l|c|c|}
\hline & \text { Direct Materials } & \text { Conversion Costs } \
\hline \text { Beginining work in process } & \$ 4,600 & \$ 2,060 \
\hline \text { Current month's costs } & 46,400 & 42,375 \
\hline \text { Ecuivalent urits based on the FIFO costingmethod } & 58,000 & 56,500 \
\hline \text { Urits completech } 55,000 & & \
\hline \text { Units in encing work in process }-5,000 & & \
\hline
\end{array}$
 Direct materials are added at the beginning of the process. Beginning work in process is 40 percent complete as to conversion costs; ending work in process inventory is 60 percent complete. The cost of ending work in process inventory totaled

Accepted Answer

A)  $7,750. 
B)  $4,650. 
C)  $5,500. 
D)  $6,250. 
A)  $7,750. 
B)  $4,650. 
C)  $5,500. 
D)  $6,250.

Question 19

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 direct materials during the month totaled

Accepted Answer

A)  6,500. 
B)  8,700. 
C)  6,700. 
D)  7,700. 
A)  6,500. 
B)  8,700. 
C)  6,700. 
D)  7,700.

Question 20

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 FIFO costing method. The following data are available for one of its accounting periods: $\begin{array}{|l|l|l|}
\hline & \text { Units } & \
\hline \text { Begining work in process } & 26,000 & \text { (70 percent complete for conversion costs) } \
\hline \text { Units stented } & 180,000 & \
\hline \text { Units transferred out } & 191,000 & \
\hline \text { Endling 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)  202,000. 
C)  176,000. 
D)  191,000. 
A)  180,000. 
B)  202,000. 
C)  176,000. 
D)  191,000.

The amount of equivalent production units for direct materials is always the same as that for conversion costs.

A company should use process costing rather than job order costing if

Under the average costing method in process costing system, the costs in beginning inventory are combined with current period costs to compute an average product unit cost.

In process costing, all costs incurred by a department or production process are divided by the equivalent units produced during the period to determine the average cost per unit produced.

Equivalent units of production usually are determined for

Under the FIFO cost flow assumption, separate unit cost analyses are not used for each accounting period because costs of different periods are averaged.

Use the following data from a company using a process costing system to answer the question below. The company uses average process costing method. - Units completed and transferred out of the department during the month totaled

Regardless of the cost approach used, in a process costing system, costs attached to units in beginning inventory are included in the computation of costs per equivalent unit.

In a process costing system, the amount of total costs to be accounted for is made up of direct materials and conversion costs incurred during the current period plus those costs included in the beginning Work in Process Inventory account.

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 direct materials during the month totaled

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

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Exam 3: Costing Systems- Process Costing

The amount of equivalent production units for direct materials is always the same as that for conversion costs.

A company should use process costing rather than job order costing if

Under the average costing method in process costing system, the costs in beginning inventory are combined with current period costs to compute an average product unit cost.

In process costing, all costs incurred by a department or production process are divided by the equivalent units produced during the period to determine the average cost per unit produced.

Equivalent units of production usually are determined for

Under the FIFO cost flow assumption, separate unit cost analyses are not used for each accounting period because costs of different periods are averaged.

Use the following data from a company using a process costing system to answer the question below. The company uses average process costing method. - Units completed and transferred out of the department during the month totaled

Regardless of the cost approach used, in a process costing system, costs attached to units in beginning inventory are included in the computation of costs per equivalent unit.

In a process costing system, the amount of total costs to be accounted for is made up of direct materials and conversion costs incurred during the current period plus those costs included in the beginning Work in Process Inventory account.

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 direct materials during the month totaled

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