Exam 6: Process Cost Accounting--Additional Procedures

Nate Company manufactures Products A and B from a joint process that also yields a by-product,X.Nate Company accounts for the revenue from its by-product sales as a deduction from the cost of its main products.Additional information is as follows: ​ (1)Assuming that joint product costs are allocated using the relative sales value at split-off approach,what was the joint cost allocated to Products A and B? (2)Prepare the journal entry to transfer the finished products to separate inventory accounts. (3)Assuming the sales value of X is stable,prepare the journal entries to: (a)place the by-product in stock (b)record the sale of 3,000 units for $10,500 on account.

The average cost method of process costing differs from the FIFO method of process costing in that the average cost method:

Howard Poster Incorporated had 12,000 units of work in process in Department A on October 1.These units were 60 percent complete as to conversion costs.Materials are added in the beginning of the process.During the month of October,38,000 units were started and 40,000 units were completed.Howard had 10,000 units of work in process on October 31.These units were 75 percent complete as to conversion costs. 1)Compute the equivalent units for materials and conversion costs for the month of October using the FIFO method. 2)Using the average cost method determine the equivalent units for materials and conversion costs for the month of October.

Information for Chaucer,Ltd.in July for the Prep Department,the first stage of the production cycle,is as follows: Material costs are added at the beginning of the process.The ending work in process is two-thirds complete as to conversion costs.How would the total costs accounted for be distributed using the average cost method?

The following information is available for the month of August from the Second department of the Twigg Corporation: Materials are added at the end of the process in the Second department.Using the average cost method,what are the equivalent units of production for materials and conversion costs for the month of August?

Material is added at the beginning of a process in a process costing system.The beginning work in process inventory for this process this period was 30 percent complete as to conversion costs.Using the first-in,first-out method of costing,the total equivalent units for material for this process during this period are equal to the:

Anderson Compounds produces two industrial chemical compounds,Gorp and Gumm,from the same process,which last year,cost $480,000.Anderson produced 20,000 pounds of Gorp,which sells for $60 per gallon and 60,000 gallons of Gumm,which sells for $30 per gallon.After the split-off point,Gorp required additional processing costing $300,000 to make it salable.Using the adjusted sales method,how much of the joint cost should be allocated to Gorp?

In a process cost system,the cost attributable to abnormal losses that occur due to unexpected circumstances such as machine operator error should be assigned to:

Regina Manufacturing uses the FIFO method of process costing.The production report for the Curing Department,where the materials are added at the beginning of the period,for September was as follows: The number of equivalent units for conversion costs during the period was:

If two or more products share a common process before they are separated,the joint costs should be allocated in a manner that:

Terrell Corporation manufactures Products X,Y,and Z from a joint process.Additional information is as follows: Assuming that joint costs are allocated using the relative sales value at split-off approach,what was the sales value at split off for Product X?

Which of the following statements best describes a by-product?

If a company using the adjusted sales value method to assign joint costs produces two products,A and B,from a joint process,and B requires additional processing after the split-off in order to be salable,how is the joint cost allocated to B determined?

Van Pelt Company uses the average cost method of process costing.The production report for the Mixing department follows: What are the equivalent units for: Materials Conversion Costs

When two products are produced during a common process,what is the factor that determines whether the products are joint products or one principal product and a by-product?

Normal losses that occur in the manufacturing process are properly classified as:

Jim Davis Company processes hogs into three products,chops,bacon and sausage.Production and selling price data follow: Hogs are processed in the Processing Department.From the split-off point,bacon is smoked,sliced and packaged in the Bacon Department.The cost incurred for these processes was $100,000.In addition,sausage was ground and formed into patties in the Sausage Department after the split-off.This process cost $60,000. Required: a)If joint processing costs were $1,500,000,calculate the total cost of each product using the adjusted sales value method. b)Prepare the journal entries to 1)record the joint processing and movement of product out of the Processing Department after the split off,and 2)record the additional processing and completion of the bacon and sausage.

Stanley Company adds materials at the beginning of the process in Department M.Data concerning the materials used in the March production follows: Using the average cost method,the equivalent units for the materials unit cost calculation are: