Question 1

The weighted-average process-costing method calculates the equivalent units by ________.

Accepted Answer

A) considering only the work done during the current period 
B) the units started during the current period minus the units in ending inventory 
C) the units started during the current period plus the units in ending inventory 
D) the equivalent units completed during the current period plus the equivalent units in ending inventory D

Question 2

The Swivel Chair Company manufacturers a standard recliner.During February,the firm's Assembly Department started production of 147,000 chairs.During the month,the firm completed 180,000 chairs and transferred them to the Finishing Department.The firm ended the month with 21,000 chairs in ending inventory.All direct materials costs are added at the beginning of the production cycle.Weighted-average costing is used by Swivel.How many chairs were in inventory at the beginning of the month? Conversion costs are incurred uniformly over the production cycle.

Accepted Answer

A) 42,000 chairs 
B) 21,000 chairs 
C) 39,900 chairs 
D) 54,000 chairs D

Question 3

A distinct feature of the FIFO process-costing method is that the ________.

Accepted Answer

A) work done on beginning inventory before the current period is blended with the work done during the current period in the calculation of equivalent units 
B) work done on beginning inventory before the current period is kept separate from the work done during the current period in the calculation of equivalent units 
C) work done on ending inventory is kept separate from the work done during the current period in the calculation of equivalent units and is usually not included in the calculation 
D) FIFO process-costing method is only minimally different from the weighted-average process-costing method B

Question 4

The Swivel Chair Company manufacturers a standard recliner.During February,the firm's Assembly Department started production of 155,000 chairs.During the month,the firm completed 185,000 chairs and transferred them to the Finishing Department.The firm ended the month with 18,000 chairs in ending inventory.All direct materials costs are added at the beginning of the production cycle.Weighted-average costing is used by Swivel.What were the equivalent units for conversion costs for February if the beginning inventory was 70% complete as to conversion costs and the ending inventory was 45% complete as to conversion costs?

Accepted Answer

A) 193,100 
B) 163,100 
C) 185,000 
D) 171,200

Question 5

The Laramie Factory produces expensive boots.It has two departments that process all the items.During January,the beginning work in process in the tanning department was 40% complete as to conversion and 100% complete as to direct materials.The beginning inventory included $6,000 for materials and $18,000 for conversion costs.Ending work-in-process inventory in the tanning department was 40% complete.Direct materials are added at the beginning of the process.
Beginning work in process in the finishing department was 60% complete as to conversion.Beginning inventories included $7,000 for transferred-in costs and $10,000 for conversion costs.Ending inventory was 30% complete.
Additional information about the two departments follows:

Required:
Prepare a production cost worksheet using weighted-average costing for the finishing department.

Accepted Answer

The answer of The Laramie Factory produces expensive boots.It has...

Question 6

Under standard costing the cost per equivalent-unit calculation is more difficult than in either weighted average or FIFO.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following entries is used to record the standard costs of direct materials assigned to units worked on and total direct materials variances?

Accepted Answer

A) Work in Process (at standard costs)  
B) Work in Process (at actual costs)  
C) Direct Materials Variances  
D) Direct Materials Variances

Question 8

In a process-costing system,there is always a separate Work-in-Process account for each different process.or department in the process.

Accepted Answer

A) True 
 B)False

Question 9

Under the weighted-average method,how would you calculate the cost per equivalent units with regards to conversion costs?

Accepted Answer

A) conversion costs for work done in the current period/units completed and transferred out in the current period 
B) (total conversion costs in beginning work in process)/(units completed and transferred out during the period + equivalent units in ending inventory) 
C) (total conversion costs in beginning work in process + conversion cost for work done in the current period)/(units completed and transferred out during the period + equivalent units in ending inventory) 
D) (total direct labor costs in beginning work in process + conversion cost for work done in the current period)/(units completed and transferred out during the period + equivalent units in ending inventory)

Question 10

The accounting entry to record the conversion cost of the Assembly Department is:
Work in Process-Assembly Department

Accepted Answer

A) True 
 B)False

Question 11

Under the FIFO method of process-costing,costs incurred and units produced in the current period are used to calculate the cost per equivalent unit of work in the current period in contrast the weighted-average method which merges the units and costs of the previous period with that of the current period.

Accepted Answer

A) True 
 B)False

Question 12

Timekeeper Inc.manufactures clocks on a highly automated assembly line.Its costing system uses two cost categories,direct materials and conversion costs.Each product must pass through the Assembly Department and the Testing Department.Direct materials are added at the beginning of the production process.Conversion costs are allocated evenly throughout production.Timekeeper Inc.uses weighted-average costing.
Data for the Assembly Department for June 2017 are:

Costs for June 2017:

What is the direct materials cost per equivalent unit during June?

Accepted Answer

A) $679.51 
B) $519.40 
C) $504.71 
D) $409.86

Question 13

If two different direct materials-such as the circuit board and microphone-are added to the process at different times,a company will need two different direct-materials categories to assign direct materials cost.

Accepted Answer

A) True 
 B)False

Question 14

A distinctive feature of the FIFO process costing method is that the work done on beginning inventory before the current period is kept separate from work done in the current period.

Accepted Answer

A) True 
 B)False

Question 15

Describe the differences between process costing and job costing.Discuss some typical products which would be more likely to use process costing as compared to some which would be more likely to use job costing.

Accepted Answer

The answer of Describe the differences between process costing and...

Question 16

Weighty Steel processes a single type of steel.For the current period the following information is given:

All materials are added at the beginning of the production process.The beginning inventory was 50% complete as to conversion,while the ending inventory was 25% completed for conversion purposes.
Weighty uses the weighted-average costing method.
What is the total cost assigned to the units completed and transferred this period? (Round intermediary dollar amounts to the nearest cent and total costs to the nearest whole dollar. )

Accepted Answer

A) $91,200 
B) $115,050 
C) $112,761 
D) $121,600

Question 17

Which of the following is an assumption under FIFO process-costing method?

Accepted Answer

A) It assumes some of the higher-cost units are placed in ending work in process. 
B) It assumes that all the lower-cost units from the previous period in beginning work in process are the first to be completed and transferred out of the process. 
C) It assumes that unit inputs costs are constant and do not fluctuate in the short run. 
D) It assumes that the ending work in process consists of only the lower-cost current-period units.

Question 18

The weighted-average cost is the total of all costs entering the Work-in-Process account (whether they are from beginning work-in-process or from work started during the current period)divided by total equivalent units of work done to date.

Accepted Answer

A) True 
 B)False

Question 19

Timekeeper Inc.manufactures clocks on a highly automated assembly line.Its costing system uses two cost categories,direct materials and conversion costs.Each product must pass through the Assembly Department and the Testing Department.Direct materials are added at the beginning of the production process.Conversion costs are allocated evenly throughout production.Timekeeper Inc.uses weighted-average costing.
Data for the Assembly Department for June 2017 are:

Costs for June 2017:

What is the total amount debited to the Work-in-Process account during the month of June?

Accepted Answer

A) $229,500 
B) $1,006,000 
C) $1,144,000 
D) $1,235,500

Question 20

A major advantage of using the FIFO process-costing method is that:

Accepted Answer

A) FIFO makes the unit cost calculations simpler 
B) in contrast with the weighted-average method,FIFO is considered GAAP 
C) FIFO provides managers with information about changes in the costs per unit from one period to the next 
D) in the period of rising prices,it leads to lower operating income and lower tax payments,saving the company cash and increasing the company's value

Exam 17: Process Costing

The weighted-average process-costing method calculates the equivalent units by ________.

A distinct feature of the FIFO process-costing method is that the ________.

Under standard costing the cost per equivalent-unit calculation is more difficult than in either weighted average or FIFO.

Which of the following entries is used to record the standard costs of direct materials assigned to units worked on and total direct materials variances?

In a process-costing system,there is always a separate Work-in-Process account for each different process.or department in the process.

Under the weighted-average method,how would you calculate the cost per equivalent units with regards to conversion costs?

The accounting entry to record the conversion cost of the Assembly Department is: Work in Process-Assembly Department

If two different direct materials-such as the circuit board and microphone-are added to the process at different times,a company will need two different direct-materials categories to assign direct materials cost.

A distinctive feature of the FIFO process costing method is that the work done on beginning inventory before the current period is kept separate from work done in the current period.

Describe the differences between process costing and job costing.Discuss some typical products which would be more likely to use process costing as compared to some which would be more likely to use job costing.

Which of the following is an assumption under FIFO process-costing method?

The weighted-average cost is the total of all costs entering the Work-in-Process account (whether they are from beginning work-in-process or from work started during the current period)divided by total equivalent units of work done to date.

A major advantage of using the FIFO process-costing method is that: