Deck 20: Process Costing

Question 1

Both job order costing and process costing:

A) maintain a single Work-in-Process Inventory account.
B) treat all period costs as product costs.
C) follow last-in, first-out method for inventory valuation.
D) have the same type of product costs.

Answer 1

D

Question 2

Which of the following businesses is most likely to use a process costing system?

A) an accounting firm
B) a law firm
C) a soda manufacturer
D) a construction company

Answer 2

C

Question 3

Which of the following statements is true of process costing?

A) It uses one Work in Process Inventory account.
B) It tracks and assigns both period costs and product costs to units produced.
C) It accumulates product costs by production departments.
D) It assigns manufacturing overhead costs to products only in the last production process.

Answer 3

C

Question 4

Under a process costing system, product costs are accumulated with respect to jobs completed.

Question 5

Under process costing, the costs incurred by each department are recorded in a separate production cost report for each department.

Question 6

Under process costing, the costs incurred by each department are recorded in:

A) a job cost sheet.
B) the Finished Goods Inventory account.
C) the Cost of Goods Sold account.
D) a production cost report.

Question 7

A textile manufacturing company is most likely to use job order costing to arrive at the cost per unit of textile manufactured and sold to customers.

Question 8

A cellular phone manufacturer is more likely to use a process costing system, rather than job order costing.

Question 9

Companies that manufacture identical items through a series of uniform production steps use ________ to determine cost per unit sold.

A) a process costing system
B) a job order costing system
C) the weighted-average method
D) the first-in, first-out method

Question 10

Process costing is the most appropriate costing method for a restaurant serving specialty cuisine.

Question 11

A process costing system is generally used by companies that produce homogeneous products.

Question 12

The combined production costs from all departments for completed products are transferred to the Cost of Goods Sold account immediately after the completion of all production processes.

Question 13

Under process costing, a single Work-in-Process Inventory account is maintained for all processes, with a subsidiary ledger containing individual production cost reports for each process.

Question 14

Under process costing, direct materials and direct labor are assigned to Work-in-process Inventory for each process that uses them.

Question 15

A process costing system is most suitable for businesses that manufacture batches of unique products or provide specialized services.

Question 16

A process is one of a series of steps in manufacturing production, usually associated with making large quantities of similar items.

Question 17

Gizmo Manufacturers, a widgets manufacturing company, divides its production operations into three processes-Department 1, Department 2, and Department 3. The company uses a process costing system. Gizmo incurred the following costs during the year 2014, to produce 5,000 units. $$\begin{array} { | r | r | } \hline \text { Department 1 } & \$ 17,500 \\\hline \text { Department 2 } & 6,000 \\\hline \text { Department 3 } & 4,000 \\\hline\end{array}$$ If Gizmo could sell only 3,500 units in 2014, what will be the cost per unit of widget produced?

A) $4.70
B) $3.50
C) $7.85
D) $5.50

Question 18

In a process costing system, each process or department has its own Work-in-Process Inventory account.

Question 19

Both job order costing and process costing track the product costs of direct materials, direct labor, and manufacturing overhead through three inventory accounts on the balance sheet.

Question 20

Under a process costing system, costs of completed products are transferred to the Finished Goods Inventory at the end of the accounting period.

Question 21

If 20,000 units are 60% complete with respect to direct materials, then the equivalent units of production for direct materials are:

A) 20,000 units.
B) 12,000 units.
C) 8,000 units.
D) 28,000 units

Question 22

In a process costing system, production costs are:

A) adjusted and allocated by jobs.
B) not inventoried.
C) directly shown on the income statement.
D) accumulated by departments.

Question 23

Organic Sugar Company at Ohio has six processing departments for refining sugar: Affination, Carbonatation, Decolorization, Boiling, Recovery, and Packaging. Conversion costs are added evenly throughout each process. Data from the month of August for the Decolorization Department are as follows: $$\begin{array} { | l | r | } \hline& \text { Metric Tons } \\\hline \text { Beginning Work-in-Process Inventory } &0\\\hline \text { Transferred in production } & 12,500 \\\hline \text { Completed and transferred out to Boiling in August } & 8,000 \\\hline \text { Ending Work-in-Process Inventory } &4,500\\\hline\end{array}$$ $$\begin{array} { | l | r | } \hline &{ \text { Costs } } \\\hline \text { Beginning Work-in-Process Inventory } & \$ 0\\\hline \text { Costs added during August: } & \\\hline \text { Direct materials } & 2,500,000 \\\hline \text { Direct labor } & 1,250,000 \\\hline \text { Manufacturing overhead } & \underline { 625,000 } \\\hline \text { Total costs added during August } & \$ 4,375,000 \\\hline\end{array}$$ The ending Work-in-Process Inventory is 100% and 65% complete with respect to direct materials and conversion costs, respectively. Compute the equivalent units of production (EUP) for direct materials and for conversion costs for the month of August.

A) 10,925 EUP for direct materials and 2,925 EUP for conversion costs
B) 12,500 EUP for direct materials and 10,925 EUP for conversion costs
C) 2,925 EUP for direct materials and 10,925 EUP for conversion costs
D) 12,500 EUP for direct materials and 2,925 EUP for conversion costs

Question 24

Under process costing, the total production costs incurred must be split between the units that have been completed in that process and transferred to the next process and the:

A) Finished Goods Inventory if it is the first process.
B) units not completed and remaining in Work-in-Process Inventory for that department.
C) Cost of Goods Sold when the units are sold.
D) Work-in-Process Inventory of the previous department when there are no sales.

Question 25

Under process costing, the unit cost of the completed units is less than the unit cost of the incomplete units.

Question 26

The Refining Department of Sweet Sugar Inc. had 55,000 tons of sugar to account for in December. Of the 55,000 tons, 45,000 tons were completed and transferred to the Boiling Department, and the remaining 10,000 tons were 60% complete. The materials required for production are added at the beginning of the process. Conversion costs are added equally throughout the refining process. Calculate the total equivalent units of production for conversion costs.

A) 6,000 units
B) 45,000 units
C) 51,000 units
D) 55,000 units

Question 27

LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2014, the first department, Mixing, had no beginning inventory. During January, 40,000 fl. oz. of chemicals were started in production. Of these, 32,000 fl. oz. were completed and 8,000 fl. oz. remained in process. In the Mixing Department, all direct materials are added at the beginning of the production process and conversion costs are applied evenly through the process. At the end of the month, LDR calculated equivalent units. The ending inventory in the Mixing Department was 60% complete with respect to conversion costs. With respect to conversion costs, how many equivalent units were calculated for the product that was completed and for ending inventory?

A) Product completed: 32,000 equivalent units; Products in ending inventory: 4,800 equivalent units
B) Product completed: 32,000 equivalent units; Products in ending inventory: 8,000 equivalent units
C) Product completed: 19,200 equivalent units; Products in ending inventory: 4,800 equivalent units
D) Product completed: 40,000 equivalent units; Products in ending inventory: 8,000 equivalent units

Question 28

Conversion costs include the costs of purchasing and converting raw materials into finished products.

Question 29

In a process costing system, equivalent units must be calculated separately for materials and conversion costs.

Question 30

LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the Refining Department had 2,000 gallons of partially processed product in production. During January, 32,000 gallons were transferred in from the Mixing Department and 29,000 gallons were completed and transferred out. At the end of the month, there were 5,000 gallons of partially processed product remaining in the Refining Department. See additional details below. Refining Department, ending balance at January 31, 2012
$$\begin{array} { | l | l | } \hline \text { Percentage completion for materials cost: } & 90 \% \\\hline \text { Percentage completion for conversion cost: } & 75 \% \\\hline\end{array}$$ For the Refining Department, what was the total number of equivalent units of production for conversion costs for the month of January?

A) 3,750 units
B) 32,750 units
C) 29,000 units
D) 4,500 units

Question 31

Which of the following statements correctly describes the term conversion costs?

A) the cost to convert finished goods to sales to customers
B) the cost incurred for direct and indirect materials during production
C) the cost of direct materials, direct labor, and manufacturing overhead costs incurred during production
D) the cost of direct labor combined with manufacturing overhead

Question 32

The direct labor costs and manufacturing overhead costs required to produce finished goods from raw materials are called:

A) transferred in costs.
B) cost of sales.
C) finished goods costs.
D) conversion costs.

Question 33

Which of the following best describes the term equivalent units?

A) partially completed units expressed in terms of fully complete units of output
B) partially completed units of output that will be sold as is
C) substitute of units that are partially completed
D) different types of units that have same selling price

Question 34

The Refining Department of Sweet Sugar Inc. had 80,000 tons of sugar to account for in July. Of the 80,000 tons, 45,000 tons were completed and transferred to the Boiling Department, and the remaining 35,000 tons were 75% complete. The materials required for production are added at the beginning of the process. Conversion costs are added equally throughout the refining process. Calculate the total equivalent units of production for direct materials.

A) 71,250 units
B) 45,000 units
C) 26,250 units
D) 80,000 units

Question 35

Muses Manufacturing produces plastic toys and uses process costing. There are three processing departments-Assembling, Finishing, and Packaging. On January 1, 2012, the Finishing Department had 2,000 units of partially processed product in production. During January, 32,000 units were transferred in from the Assembling Department and 29,000 units were completed and transferred out. At the end of the month, there were 5,000 units of partially processed products remaining in the Finishing Department. See additional details below. Finishing Department, ending balance at January 31, 2012
$$\begin{array} { | l | l | } \hline \text { Percentage completion for materials cost: } & 90 \% \\\hline \text { Percentage completion for conversion cost: } & 75 \% \\\hline\end{array}$$ For the Finishing Department, what was the number of equivalent units for the month of January, with respect to direct materials?

A) 33,500 units
B) 34,000 units
C) 29,000 units
D) 4,500 units

Question 36

In a process costing system, a department's total production costs incurred in a particular period must equal the total costs transferred out of the department.

Question 37

At the end of an accounting period, the costs assigned to a production department can be split into the cost of units fully completed and transferred, and the cost of units partially completed and remaining in the Work-in-Process Inventory of that department.

Question 38

The equivalent units of production for direct materials and conversion costs must be the same.

Question 39

The Assembly Department of Smart Computers had a beginning inventory of 5,000 units. During November, it assembled 2,000 units and transferred them to the Packaging Department. It incurred $250,000 in direct materials and $75,000 in conversion costs. The ending inventory in November was 3,000 units which were 100% and 60% complete with respect to materials and conversion costs, respectively. Calculate the total equivalent units of production for conversion costs for November.

A) 2,000 units
B) 5,000 units
C) 3,800 units
D) 1,800 units

Question 40

LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2014, the first department, Mixing, had no beginning inventory. During January, 40,000 fl. oz. of chemicals were started in production. Of these, 32,000 fl. oz. were completed and 8,000 fl. oz. remained in process. In the Mixing Department, all direct materials are added at the beginning of the production process and conversion costs are applied evenly through the process. At the end of the month, LDR calculated equivalent units. The ending inventory in the Mixing Department was 60% complete with respect to conversion costs. With respect to direct materials, what is the number of equivalent units in the ending inventory?

A) 4,800 equivalent units
B) 32,000 equivalent units
C) 40,000 equivalent units
D) 8,000 equivalent units

Question 41

In a production cost report, ________ includes the number of units completed and transferred out of a process and the number of units remaining in ending work-in-process.

A) total units estimated for
B) total units budgeted for
C) total units accounted for
D) total units to account for

Question 42

The Assembly Department of Smart Computers had 500 units of beginning inventory in the month of September and 2,000 units were transferred to it from the Production Department. The Assembly Department completed 1,000 units during the month and transferred them to the Packaging Department. Calculate the total number of units to account for by the Assembly Department.

A) 1,500 units
B) 2,000 units
C) 500 units
D) 2,500 units

Question 43

Which of the following is a step in the preparation of a production cost report?

A) assignment of costs to units completed and units in process
B) summarization of the flow of physical units to the suppliers
C) computation of expected units of production
D) computation of amount of materials required for production

Question 44

A report prepared by a processing department for equivalent units of production, production costs, and the assignment of those costs to the completed and in process units is called a(n):

A) organizational report.
B) sales revenue report.
C) job costing report.
D) production cost report.

Question 45

The Assembly Department of Smart Computers had 500 units of beginning inventory in the month of September and 2,000 units were transferred to it by the Production Department. The Assembly Department completed 1,000 units during the month and transferred them to the Packaging Department. Calculate the total number of units accounted for by the Assembly Department if it had 1,500 units in ending inventory.

A) 1,500 units
B) 2,000 units
C) 500 units
D) 2,500 units

Question 46

The task of summarizing the flow of physical units is one of the four steps involved in the preparation of the production cost report.

Question 47

Which of the following formulae is used to calculate the cost per equivalent unit of production (EUP) for direct materials?

A) Cost per EUP for direct materials = Total conversion costs ÷ Equivalent units of production for direct materials
B) Cost per EUP for direct materials = Total direct materials costs ÷ Equivalent units of production for direct materials
C) Cost per EUP for direct materials = Total transferred in costs ÷ Equivalent units for transferred in
D) Cost per EUP for direct materials = Total direct materials costs ÷ Equivalent units of production for conversion costs

Question 48

The costs that were incurred in a previous process and brought into a later process as part of the product's cost are called "________" costs.

A) transferred in
B) transferred out
C) accounted for
D) to account for

Question 49

In a production cost report, the number of units to account for must always be greater than the number of units accounted for.

Question 50

The beginning inventory costs and current period costs are combined to determine the average cost of equivalent units of production under the:

A) equivalent units method.
B) conversion costs method.
C) first-in, first-out method.
D) weighted-average method.

Question 51

The cost per equivalent unit for transferred in units is calculated by dividing total transferred in costs by the equivalent units of production for transferred in.

Question 52

The equivalent units of production for transferred in units are always 100% because:

A) they are the finished goods purchased and transferred to the next process.
B) they are considered 100% complete with respect to the entire production process.
C) they were 100% complete with respect to the previous process.
D) such units are not utilized for production in the subsequent processes.

Question 53

Cost amounts that are transferred out of one process become the transferred in cost for the next process.

Question 54

The weighted average method determines the cost of equivalent units of production by accounting for beginning inventory costs separately from current period costs.

Question 55

A production cost report shows only the calculations for the physical flow of products.

Question 56

The cost amounts that are transferred out from one process to another process become transferred in costs for the receiving process.

Question 57

Under process costing, the number of units to account for must always be ________ the number of units accounted for.

A) greater than
B) lesser than
C) equal to
D) twice

Question 58

In a production cost report, the number of "total units to account for" consists of:

A) units in process at the beginning of the period and units started or added during the period.
B) units in process at the end of the period and units started or added during the period.
C) units in process at the beginning of the period and units remaining at the end of the period.
D) units of completed and transferred out products and total units produced.

Question 59

The production cost reports show the calculations for the physical flows and the ________ flows of the products.

A) cash
B) price
C) cost
D) supply

Question 60

The number of equivalent units for direct materials and conversion costs must always be equal.

Question 61

Organic Sugar Company at Ohio has six processing departments for refining sugar: Affination, Carbonatation, Decolorization, Boiling, Recovery, and Packaging. Conversion costs are added evenly throughout each process. Data from the month of August for the Recovery Department are as follows: $$\begin{array} { | l | r | } \hline& { \text { Metric Tons } }\\\hline \text { Beginning Work-in-Process Inventory } &0 \\\hline \text { Started in production } & 20,500 \\\hline \text { Ending Work-in-Process Inventory } & 5,500 \\\hline\end{array}$$ $$\begin{array} { | l | r | } \hline & { \text { Costs } } \\\hline \text { Beginning Work-in-Process Inventory } & \$ 0 \\\hline \text { Costs added during August: } & \\\hline \text { Direct materials } & 500,000 \\\hline \text { Direct labor } & 250,000 \\\hline \text { Manufacturing overhead } & \underline { 125,000 } \\\hline \text { Total costs added during August } & \$ 875,000 \\\hline\end{array}$$ The ending Work-in-Process Inventory is 100% and 95% complete with respect to direct materials and conversion costs respectively. How many metric tons of sugar were refined and transferred to the Packaging Department in August?

A) 20,500 metric tons
B) 5,500 metric tons
C) 15,000 metric tons
D) 9,500 metric tons

Question 62

When indirect materials are issued to production, the Raw Materials Inventory account is credited.

Question 63

Under a process costing system, direct labor costs are assigned to the Work-in-Process account of the department for which they are incurred.

Question 64

LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2014, the first department, Mixing, had no beginning inventory. During January, 40,000 fl. oz. of chemicals were started in production. Of these, 32,000 fl. oz. were completed and 8,000 fl. oz. remained in process. In the Mixing Department, all direct materials are added at the beginning of the production process and conversion costs are applied evenly through the process.
At the end of January, the equivalent unit data for the Mixing Department were as follows:
$$\begin{array} { | l | r | r | r | } \hline \text { UNITS } & \text { Whole Units } & \text { Equivalent Units } & \text { Equivalent Units } \\\hline \text { Units to account for } & & \text { Direct Materials Cost } & \text { Conversion Cost } \\\hline \text { Completed } & 32,000 & 32,000 & 32,000 \\\hline \text { End bal. WIP } & 8,000 & 8,000 & 4,800 \\\hline & 40,000 & 40,000 & 36,800 \\\hline\end{array}$$ In addition to the above, the costs per equivalent unit were $1.20 for direct materials and $5.75 for conversion costs. Using this data, calculate the cost of the units that were transferred out of the Mixing Department and into the Refining Department.

A) $211,600
B) $48,000
C) $222,400
D) $37,200

Question 65

The journal entry to record indirect labor costs incurred includes a debit to Manufacturing Overhead and credit to Wages Payable.

Question 66

When finished products are sold, Sales Revenue is debited and Cost of Goods Sold is credited.

Question 67

Direct labor costs are accumulated in the Manufacturing Overhead account.

Question 68

LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the first department, Mixing, had a zero beginning balance. During January, 40,000 gallons of chemicals were started into production. During the month, 32,000 gallons were completed, and 8,000 remained in process, partially completed. In the Mixing Department, all direct materials are added at the beginning of the production process, and conversion costs are applied evenly through the process.
During January, the Mixing Department incurred $48,000 in direct materials costs and $211,600 in conversion costs. At the end of the month, the ending inventory in the Mixing Department was 60% complete with respect to conversion costs.
The total cost of product in ending inventory was:

A) $211,600.
B) $48,000.
C) $37,200.
D) $222,400.

Question 69

The Assembly Department of Smart Computers incurred $250,000 in direct materials and $75,000 in conversion costs. The equivalent units of production for direct materials and conversion costs are 1,000 and 800, respectively. The cost per equivalent unit of production (EUP) for conversion costs is:

A) $93.75 per EUP.
B) $75.00 per EUP.
C) $312.50 per EUP.
D) $250.00 per EUP.

Question 70

LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the Refining Department had 2,000 gallons of partially processed product in production. During January, 32,000 gallons were transferred in from the Mixing Department and 29,000 gallons were completed and transferred out. At the end of the month, there were 5,000 gallons of partially processed product remaining in the Refining Department. See additional details below.
Refining Department, beginning balance at January 1, 2012
Costs added during January
Refining Department, ending balance at January 31, 2012
For the Refining Department in the month of January, what was cost per equivalent unit with respect to conversion costs? (Use the weighted average method and round your calculations to the nearest cent.)

A) $1.40
B) $3.00
C) $1.34
D) $2.86

Question 71

When indirect materials are issued to production, the Manufacturing Overhead account is credited.

Question 72

Under process costing, depreciation on plant machinery is debited to the respective process's Work-in-Process Inventory.

Question 73

LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2014, the first department, Mixing, had no beginning inventory. During January, 40,000 fl. oz. of chemicals were started in production. Of these, 32,000 fl. oz. were completed and 8,000 fl. oz. remained in process. In the Mixing Department, all direct materials are added at the beginning of the production process and conversion costs are applied evenly through the process.
At the end of the month, LDR calculated equivalent units in the Mixing Department as shown below:
$$\begin{array} { | l | r | r | r | } \hline \text { UNITS } & \text { Whole Units } & \text { Equivalent Units } & \text { Equivalent Units } \\\hline \text { Units to account for } & & \text { Direct Materials Cost } & \text { Conversion Cost } \\\hline \text { Completed } & 32,000 & 32,000 & 32,000 \\\hline \text { End bal. WIP* } & 8,000 & 8,000 & 4,800 \\\hline & 40,000 & 40,000 & 36,800 \\\hline\end{array}$$ * % of completion for direct materials costs: 100%
% of completion for conversion costs: 60%
During January, the Mixing Department incurred $48,000 in direct materials costs and $211,600 in conversion costs. How much was the cost per equivalent unit for materials and for conversion costs?
(Use the weighted average method and round your answer to the nearest cent)

A) $6.00 for materials, $5.29 for conversion
B) $1.20 for materials, $6.61 for conversion
C) $1.50 for materials, $6.61 for conversion
D) $1.20 for materials, $5.75 for conversion

Question 74

The Assembly Department of Smart Computers incurred $250,000 in direct materials and $75,000 in conversion costs. The equivalent units of production for direct materials and conversion costs are 1,000 and 800, respectively. The cost per equivalent unit of production for direct materials is:

A) $93.75.
B) $75.00.
C) $312.50.
D) $250.00.

Question 75

Organic Sugar Company at Ohio has six processing departments for refining sugar: Affination, Carbonatation, Decolorization, Boiling, Recovery, and Packaging. Conversion costs are added evenly throughout each process. Data from the month of August for the Decolorization Department are as follows: $$\begin{array} { | l | r | } \hline& \text { Metric Tons } \\\hline \text { Beginning Work-in-Process Inventory } &0 \\\hline \text { Started in production } & 12,500 \\\hline \text { Completed and transferred out to Boiling in August } & 7,000 \\\hline \text { Ending Work-in-Process Inventory } & 5,500 \\\hline\end{array}$$ $$\begin{array} { | l | r | } \hline &{ \text { Costs } } \\\hline \text { Beginning Work-in-Process Inventory } & \$ 0 \\\hline \text { Costs added during August: } & \\\hline \text { Direct materials } & 2,500,000 \\\hline \text { Direct labor } & 1,250,000 \\\hline \text { Manufacturing overhead } & \underline { 625,000 } \\\hline \text { Total costs added during August } & \$ 4,375,000 \\\hline\end{array}$$ The ending Work-in-Process Inventory is 100% and 65% complete with respect to direct materials and conversion costs respectively. Compute the cost per equivalent unit for the units transferred to the Boiling process. (Round your answer to two decimal places)

A) $446.00 per metric ton
B) $536.00 per metric ton
C) $414.00 per metric ton
D) $377.30 per metric ton

Question 76

When raw materials are purchased on account, the Accounts Payable account is credited.

Question 77

LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the Refining Department had 2,000 gallons of partially processed product in production. During January, 32,000 gallons were transferred in from the Mixing Department and 29,000 gallons were completed and transferred out. At the end of the month, there were 5,000 gallons of partially processed product remaining in the Refining Department. See additional details below.
Refining Department, beginning balance at January 1, 2012
Costs added during January
Refining Department, ending balance at January 31, 2012
For the Refining Department in the month of January, what was cost per equivalent unit with respect to direct materials costs? Use the weighted-average method. (Round your calculations to the nearest cent.)

A) $1.40
B) $3.00
C) $1.34
D) $7.00

Question 78

The Raw Materials Inventory account is debited when direct materials are issued for production.

Question 79

LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2014, the first department, Mixing, had no beginning inventory. During January, 40,000 fl. oz. of chemicals were started in production. Of these, 32,000 fl. oz. were completed and 8,000 fl. oz. remained in process. In the Mixing Department, all direct materials are added at the beginning of the production process and conversion costs are applied evenly through the process.
At the end of January, the equivalent unit data for the Mixing Department were as follows:
$$\begin{array} { | l | r | r | r | } \hline \text { UNITS } & \text { Whole Units } & \text { Equivalent Units } & \text { Equivalent Units } \\\hline \text { Units to account for } & & \text { Direct Materials Cost } & \text { Conversion Cost } \\\hline \text { Completed } & 32,000 & 32,000 & 32,000 \\\hline \text { End bal. WIP } & 8,000 & 8,000 & 4,800 \\\hline & 40,000 & 40,000 & 36,800 \\\hline\end{array}$$ In addition to the above, the costs per equivalent unit were $5.50 for direct materials and $3.60 for conversion costs. Using this data, calculate the full cost of the ending balance in the Mixing Department.

A) $35,600
B) $48,000
C) $61,280
D) $222,400

Question 80

LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the first department, Mixing, had a zero beginning balance. During January, 40,000 gallons of chemicals were started into production. During the month, 32,000 gallons were completed, and 8,000 remained in process, partially completed. In the Mixing Department, all direct materials are added at the beginning of the production process, and conversion costs are applied evenly through the process.
During January, the Mixing Department incurred $60,000 in direct materials costs and $230,000 in conversion costs. At the end of the month, the ending inventory in the Mixing Department was 60% complete with respect to conversion costs. First, calculate the equivalent units, then calculate the cost per equivalent unit, and then calculate the total cost of the product that was completed and transferred out during January.
The total cost of product transferred out was:

A) $304,347.
B) $280,000.
C) $243,478.
D) $248,000.