Deck 4: Process Costing

Question 1

Black Company uses the weighted-average method in its process costing system. company's ending work in process inventory consists of 5,000 units, 80% complete with respect to materials and 50% complete with respect to labour and overhead. If the total dollar value of the inventory is $60,000 and the cost per equivalent unit for labour and overhead is $8.00, the cost per equivalent unit for materials must be?

A)$8.00.
B)$4.00.
C)$10.00.
D)$5.00.

Answer 1

C

Question 2

Reference: 04-08
Information about units processed and processing costs incurred during a recent month in the Blending
Department of a manufacturing company follow: $$\begin{array} { | l | l | l | } \hline & \begin{array} { l } \text { Number of } \\\text { Units }\end{array} & \begin{array} { l } \text { Conversion Costs } \\\text { (Percent Completion) }\end{array} \\\hline \text { Beginning work in process inventory } & 11,000 & 35 \% \\\hline \text { Units started into production } & 120,000 & - \\\hline \text { Units completed and transferred out } & 114,000 & - \\\hline \text { Ending work in process inventory } & 17,000 & 30 \% \\\hline\end{array}$$ The beginning work in process inventory included $11,000 of conversion cost and $ 12,000 in material costs. During the month, the Department incurred an additional $290,000 in conversion costs and $ 143,000 in material costs. All materials are added at the beginning of production in each department.

-Assuming that the company uses the weighted-average cost method, what are th? equivalent units of production for material costs for the Blending Department for the month?

A)131,000 units.
B)120,000 units.
C)119,100 units.
D)114,000 units.

Answer 2

131,000 units.

Question 3

Reference: 04-10
Nando Company uses the weighted-average method in its process costing system. Department J is the second of three sequential processes at the company. During October, Department J collected the following data: $$\begin{array}{l}\begin{array} { | l | l | l | } \hline & \text { Units } & \begin{array} { l } \text { Labour and Overhead } \\\text { (Percentage Complete) }\end{array} \\\hline \text { Work in process, October 1 } & 8,000 & 60 \% \\\hline \text { Units started } & 25,000 & \\\hline \text { Completed and transferred } & 20,000 & \\\hline \text { Work in process, October } 31 & 13,000 & 20 \% \\\hline\end{array}\\\begin{array} { | l | l | l | l | } \hline \text { Costs for October: } & \text { Transferred In } & \text { Materials } & \begin{array} { l } \text { Labour and } \\\text { Overhead }\end{array} \\\hline \text { Work in process, October } 1 & \$ 33,000 & \$ 16,500 & \$ 31,200 \\\hline \text { Added during the month } & \$ 59,400 & \$ 82,500 & \$ 194,800 \\\hline\end{array}\end{array}$$ All materials are added at the beginning of the process.

-The total cost assigned to units transferred out during October was

A)$316,000.
B)$264,600.
C)$342,000.
D)$358,400.

Answer 3

$316,000.

Question 4

Reference: 04-06
The information below was obtained from the records of the first processing department of Christine Corporation for the month of July. The company uses the weighted-average method in its process costing system. $$\begin{array} { | l | l | l | } \hline & \text { Units } & \begin{array} { l } \text { Labour and Overhead } \\\text { (Percentage Complete) }\end{array} \\\hline \text { Work in process inventory, July 1 } & 20,000 & 40 \% \\\hline \text { Started during the month } & 70,000 & \\\hline \text { Completed during the month } & 80,000 & \\\hline \text { Work in process inventory, July } 31 & ? & 25 \% \\\hline\end{array}$$ All materials are added at the beginning of the manufacturing process.

-The equivalent units of production for material for the month are?

A)90,000 units.
B)70,000 units.
C)80,000 units.
D)82,500 units.

Question 5

Overland, Inc. company's work in process inventory on April 30 consists of 25,000 units.

A)$159,375.
B)$109,375.
C)$178,125.
D)$212,500.

Question 6

The following data were taken from the accounting records of the Hazel Corporatio? which uses the weighted-average method in its process costing system: $$\begin{array} { | c | l | } \hline \text { Beginning work in process inventory } & \\\hline ( 100 \% \text { complete as to materials; } & \\\hline 70 \% \text { complete as to conversion) } & 30,000 \text { units } \\\hline \text { Started in process during the period } & 90,000 \text { units } \\\hline \text { Ending work in process inventory } & \\\hline ( 100 \% \text { complete as to materials; } & \\\hline 60 \% \text { complete as to conversion) } & 20,000 \text { units } \\\hline\end{array}$$ The equivalent units of production for materials costs were?

A)120,000.
B)100,000.
C)90,000.
D)112,000.

Question 7

Assuming that there was no beginning work in process inventory, and the ending work in process inventory is 50% complete with respect to conversion costs, the number of equivalent units of production with respect to conversion costs under the weighted-average method would be?

A)less than the units started during the period.
B)the same as the units completed.
C)the same as the units started during the period.
D)less than the units completed.

Question 8

In the accounting for costs in a process costing system, which statement below is most correct as to when costs are added in processing departments?

A)labour and overhead costs are added in each department as processing takes place but materials costs are only added in the last processing department when the final quantities of materials used have been determined.
B)all material costs will be added in the first processing department and labour and overhead costs will be added in subsequent departments.
C)material, labour and overhead costs may be added in any processing department.
D)material and labour costs may be added in any department but overhead costs will only be added in the last processing department in which the processing of the product is completed.

Question 9

Reference: 04-09
Kimbeth Manufacturing makes Dust Density Sensors (DDS), a safety device for the mining industry. The company uses a process costing system and has only a single processing department. The following information pertains to operations for the month of May: $\begin{array}{|l|l|}\hline & \text { Units } \\\hline \text { Beginning work in process inventory } & 16,000 \\\hline \text { Started into production during May } & 100,000 \\\hline \text { Completed during May } & 92,000 \\\hline \text { Ending work in process inventory } & 24,000 \\\hline\end{array}$
The beginning work in process inventory was $60 \%$ complete with respect to materials and $20 \%$ complete with respect to conversion costs. The ending work in process inventory was $90 \%$ complete with respect to materials and $40 \%$ complete with respect to conversion costs. The costs were as follows:
$\begin{array}{|l|l|l|}\hline & \text { Conversion } & \text { Materials } \\\hline \text { Beginning work in process inventory } & \$ 54,560 & \$ 35,560 \\\hline \text { Costs incurred during May } & \$ 468,000 & \$ 574,040 \\\hline\end{array}$

-Using the FIFO method, the equivalent unit cost of materials is

A)$6.40.
B)$5.40.
C)$4.76.
D)$5.52.

Question 10

Reference: 04-12
GK Manufacturing had inventory at May 1 of 5,000 units which were 70% complete as to conversion costs. The
May 1 inventory had total costs of $ 69,900 which included $ 21,500 direct materials, $ 38,775 direct labour and
$ 9,625 factory overhead.
Costs added to work in process in May were as follows:
$$\begin{array} { | l | l | } \hline \text { Direct materials } & \$ 298,800 \\\hline \text { Direct labour } & \$ 540,800 \\\hline \text { Factory overhead } & \$ 135,400 \\\hline\end{array}$$ During May, 49,200 units were completed, including those in inventory on May 1. On May 30, the inventory of work in process consisted of 5,600 units which were 3/8 completed as to conversion costs. Inventories are costed by the first-in, first-out method and all materials are added at the beginning of the process.

-What amount below was the total cost of units completed during May closest to

A)$1,044,900.
B)$981,755.
C)$911,685.
D)$975,000.

Question 11

In which circumstance is the FIFO method more likely to be preferred in determining the costs of processing?

A)staff in the accounting department lack expertise and experience in costing.
B)there are regularly little work-in-process inventories on hand.
C)there are never any work-in-process inventories on hand.
D)there are regularly substantial work-in-process inventories on hand.

Question 12

Reference: 04-12
GK Manufacturing had inventory at May 1 of 5,000 units which were 70% complete as to conversion costs. The
May 1 inventory had total costs of $ 69,900 which included $ 21,500 direct materials, $ 38,775 direct labour and
$ 9,625 factory overhead.
Costs added to work in process in May were as follows: $$\begin{array} { | l | l | } \hline \text { Direct materials } & \$ 298,800 \\\hline \text { Direct labour } & \$ 540,800 \\\hline \text { Factory overhead } & \$ 135,400 \\\hline\end{array}$$ During May, 49,200 units were completed, including those in inventory on May 1. On May 30, the inventory of work in process consisted of 5,600 units which were 3/8 completed as to conversion costs. Inventories are costed by the first-in, first-out method and all materials are added at the beginning of the process.

-What were the equivalent units of production for conversion costs for May

A)49,200 units.
B)46,300 units.
C)52,800 units.
D)47,800 units.

Question 13

Baker Company uses the weighted-average method in its process costing system. The Assembly Department started the month with 8,000 units in its beginning work in process inventory that were 90% complete with respect to conversion costs. An additional 95,000 units were transferred in from the prior department during the month to begin processing in the Assembly Department. There were 11,000 units in the ending work in process inventory of the Assembly Department that were 90% complete with respect to conversion costs. What were the equivalent units of production for conversion costs in the Assembly
Department for the month?

A)101,900.
B)94,700.
C)98,000.
D)92,000.

Question 14

Reference: 04-07
The information below was obtained from the records of the first processing department of Moore Company for the month of May. The company uses the weighted-average method in its process costing system. $$\begin{array} { | l | l | l | } \hline & \text { Units } & \begin{array} { l } \text { Labour and Overhead } \\\text { (Percentage Complete) }\end{array} \\\hline \text { Work in process, May 1 } & 10,000 & 40 \% \\\hline \text { Units started } & 64,000 & \\\hline \text { Completed and transferred out } & 60,000 & \\\hline \text { Work in process, May 31 } & 14,000 & 70 \%\\\hline\end{array}$$ All materials are added at the beginning of the process.

-The equivalent units of production for materials for the month of May were

A)74,000 units.
B)64,000 units.
C)60,000 units.
D)69,800 units.

Question 15

Reference: 04-11
The following data relate to the Forming Department of Jimbob Co. for a recent month: $$\begin{array} { | l | l | l | } \hline & \begin{array} { l } \text { Number of } \\\text { Units }\end{array} & \begin{array} { l } \text { Conversion Costs } \\\text { (Percent Complete) }\end{array} \\\hline \text { Beginning work in process inventory } & 9,000 & 60 \% \\\hline \text { Units started into production } & 45,000 & - \\\hline \text { Units completed and transferred out } & 46,000 & - \\\hline \text { Ending work in process inventory } & 8,000 & 25 \% \\\hline\end{array}$$ All materials are added prior to the beginning of work in the Forming Department.

-Assuming that Jimbob Co. materials would be?

A)46,000 units.
B)48,000 units.
C)54,000 units.
D)45,000 units.

Question 16

Paxton Company uses the weighted-average method in its process costing system. Molding Department is the second department in its production process.

A)$4.038.
B)$5.348.
C)$4.704.
D)$5.080.

Question 17

Reference: 04-09
Kimbeth Manufacturing makes Dust Density Sensors (DDS), a safety device for the mining industry. The company uses a process costing system and has only a single processing department. The following information pertains to operations for the month of May: $\begin{array}{|l|l|}\hline & \text { Units } \\\hline \text { Beginning work in process inventory } & 16,000 \\\hline \text { Started into production during May } & 100,000 \\\hline \text { Completed during May } & 92,000 \\\hline \text { Ending work in process inventory } & 24,000 \\\hline\end{array}$
The beginning work in process inventory was $60 \%$ complete with respect to materials and $20 \%$ complete with respect to conversion costs. The ending work in process inventory was $90 \%$ complete with respect to materials and $40 \%$ complete with respect to conversion costs. The costs were as follows:
$\begin{array}{|l|l|l|}\hline & \text { Conversion } & \text { Materials } \\\hline \text { Beginning work in process inventory } & \$ 54,560 & \$ 35,560 \\\hline \text { Costs incurred during May } & \$ 468,000 & \$ 574,040 \\\hline\end{array}$

-Using the FIFO method, the total cost of units in ending work in process is ?( Round th? per unit value to the nearest cent and do not round other intermediate calculations )

A)$104,000.
B)$128,000.
C)$164,883.
D)$153,000.

Question 18

Reference: 04-04
The activity in Nolan Company's Blending Department for the month of April is given below:
$$\begin{array} { | c | l | l | } \hline & \begin{array} { l } \text { Number of } \\\text { Units }\end{array} & \begin{array} { l } \text { Labour and Overhead } \\\text { (Percentage Complete) }\end{array} \\\hline \text { Work in process } & & \\\hline \text { inventory, April 1 } & 8,000 & 50 \% \\\hline \text { Started into process } & & \\\hline \text { during the month } & 50,000 & \\\hline \text { Work in process } & & \\\hline \text { inventory, April 30 } & 10,000 & 70 \% \\\hline\end{array}$$ All materials are added at the beginning of processing in the Blending Department.

-The equivalent units of production for labour and overhead for the month, using the weighted-average method, are?

A)50,000 units.
B)55,000 units.
C)47,000 units.
D)51,000 units.

Question 19

Reference: 04-07
The information below was obtained from the records of the first processing department of Moore Company for the month of May. The company uses the weighted-average method in its process costing system. $$\begin{array} { | l | l | l | } \hline & \text { Units } & \begin{array} { l } \text { Labour and Overhead } \\\text { (Percentage Complete) }\end{array} \\\hline \text { Work in process, May 1 } & 10,000 & 40 \% \\\hline \text { Units started } & 64,000 & \\\hline \text { Completed and transferred out } & 60,000 & \\\hline \text { Work in process, May 31 } & 14,000 & 70 \% \\\hline\end{array}$$ All materials are added at the beginning of the process.

-The equivalent units of production for labour and overhead for the month of May were

A)69,800 units.
B)73,800 units.
C)65,800 units.
D)60,000 units.

Question 20

Reference: 04-09
Kimbeth Manufacturing makes Dust Density Sensors (DDS), a safety device for the mining industry. The company uses a process costing system and has only a single processing department. The following information pertains to operations for the month of May: $\begin{array}{|l|l|}\hline & \text { Units } \\\hline \text { Beginning work in process inventory } & 16,000 \\\hline \text { Started into production during May } & 100,000 \\\hline \text { Completed during May } & 92,000 \\\hline \text { Ending work in process inventory } & 24,000 \\\hline\end{array}$
The beginning work in process inventory was $60 \%$ complete with respect to materials and $20 \%$ complete with respect to conversion costs. The ending work in process inventory was $90 \%$ complete with respect to materials and $40 \%$ complete with respect to conversion costs. The costs were as follows:
$\begin{array}{|l|l|l|}\hline & \text { Conversion } & \text { Materials } \\\hline \text { Beginning work in process inventory } & \$ 54,560 & \$ 35,560 \\\hline \text { Costs incurred during May } & \$ 468,000 & \$ 574,040 \\\hline\end{array}$

-Using the weighted-average method, the total cost of the units in ending work in process inventory is

A)$168,960.
B)$172,336.
C)$165,336.
D)$156,960.

Question 21

Reference: 04-04
The activity in Nolan Company's Blending Department for the month of April is given below:
$$\begin{array} { | c | l | l | } \hline & \begin{array} { l } \text { Number of } \\\text { Units }\end{array} & \begin{array} { l } \text { Labowr and Overhead } \\\text { (Percentage Complete) }\end{array} \\\hline \text { Work in process } & & \\\hline \text { inventory, April 1 } & 8,000 & 50 \% \\\hline \text { Started into process } & & \\\hline \text { during the month } & 50,000 & \\\hline \text { Work in process } & & \\\hline \text { inventory, April } 30 & 10,000 & 70 \% \\\hline\end{array}$$ All materials are added at the beginning of processing in the Blending Department.

-The equivalent units of production for material for the month, using the weighted-average method, are?

A)58,000 units.
B)48,000 units.
C)50,000 units.
D)52,000 units.

Question 22

Sarver Company uses the weighted-average method in its process costing system. The Fitting Department is the second department in its production process. The data below summarize the department's operations in March. $$\begin{array} { | l | l | l | } \hline & \text { Units } & \text { Percentage complete } \\\hline \text { Beginning work in process inventory } & 7,100 & 70 \% \\\hline \text { Transferred in from the prior } & & \\\hline \text { department during March } & 61,000 & \\\hline \text { Ending work in process inventory } & 4,600 & 30 \% \\\hline\end{array}$$ The Fitting Department's production report indicates that the cost per equivalent unit for conversion cost for March was $8.24. How much conversion cost was assigned to the units transferred out of the Fitting
Department during March?

A)$561,144.00.
B)$523,240.00.
C)$502,640.00.
D)$482,287.20.

Question 23

The Morgan Company uses the weighted-average method in its process costing system. For a particular department, the company had 54,000 equivalent units of production with respect to conversion costs in March. There were 7,500 units in the department's beginning work in process inventory, two thirds complete with respect to conversion costs. During March, 52,500 units were started and 50,000 were completed and transferred out of the department. The ending work in process inventory in the department?

A)consisted of 5,000 units.
B)was 65% complete with respect to conversion costs.
C)was 40% complete with respect to conversion costs.
D)consisted of 2,500 units.

Question 24

In a process cost system, the cost of completed production in Department 1 is transferred to Department 2 by which of the following entries?

A)debit Work in Process Department 2, credit Work in Process Department 1.
B)debit Finished Goods, credit Work in Process Department 2.
C)debit Work in Process - Department 2, credit Cost of Goods Sold Department 1.
D)debit Work in Process Department 2, credit Finished Goods Department 1.

Question 25

Jawson Company uses the weighted-average method in its process costing system. Operating data for the Painting Department for the month of April appear below: $$\begin{array} { | l | l | c | } \hline & \text { Units } & \text { Percentage complete } \\\hline \text { Beginning work in process inventory } & 6,300 & 10 \% \\\hline \text { Transferred in from the prior } & & \\\hline \text { department during April } & 65,600 & \\\hline \text { Ending work in process inventory } & 4,600 & 70 \% \\\hline\end{array}$$ What were the equivalent units of production for conversion costs in the Painting
Department for April?

A)70,520.
B)63,900.
C)67,300.
D)68,820.

Question 26

Reference: 04-08
Information about units processed and processing costs incurred during a recent month in the Blending
Department of a manufacturing company follow: $$\begin{array} { | l | l | l | } \hline & \begin{array} { l } \text { Number of } \\\text { Units }\end{array} & \begin{array} { l } \text { Conversion Costs } \\\text { (Percent Completion) }\end{array} \\\hline \text { Beginning work in process inventory } & 11,000 & 35 \% \\\hline \text { Units started into production } & 120,000 & - \\\hline \text { Units completed and transferred out } & 114,000 & - \\\hline \text { Ending work in process inventory } & 17,000 & 30 \% \\\hline\end{array}$$ The beginning work in process inventory included $11,000 of conversion cost and $ 12,000 in material costs. During the month, the Department incurred an additional $290,000 in conversion costs and $ 143,000 in material costs. All materials are added at the beginning of production in each department.

-Assuming that the company uses the weighted-average cost method, what is the total value of the ending work in process inventory in the Blending Department

A)$12,903.
B)$20,060.
C)$63,070.
D)$32,963.

Question 27

Trapp Company uses the weighted-average method in its process costing system. The beginning work in process inventory in its Painting Department consisted of 3,000 units that were 70% complete with respect to materials and 60% complete with respect to conversion costs. The cost of the beginning work in process inventory in the department was recorded as $10,000. During the period, 9,000 units were completed and transferred on to the next department. The costs per equivalent unit for the period were $2.00 for material and $3.00 for conversion costs. The cost of units transferred out during the month was?

A)$45,400.
B)$35,400.
C)$39,600.
D)$45,000.

Question 28

Valley Manufacturing Company's beginning work in process inventory consisted of 10,000 units, 100% complete with respect to materials cost and 40% complete with respect to conversion costs. The total cost in the beginning inventory was $30,000. During the month, 50,000 units were transferred out. The equivalent unit cost was computed to be $2.00 for materials and $3.70 for conversion costs under the
Weighted-average method. Given this information, the total cost of the units completed and transferred out was?

A)$255,000.
B)$270,000.
C)$240,000.
D)$285,000.

Question 29

Assuming that the company uses the weighted-average cost method, what is the cost per equivalent unit for material costs for the month in the Blending Department

A)$1.18.
B)$1.09.
C)$1.25.
D)$1.22.

Question 30

Reference: 04-05
The following data relate to the Blending Department of Tru-Colour Paint Company for a recent month: $$\begin{array} { | l | l | l | } \hline & \begin{array} { l } \text { Number of } \\\text { Units }\end{array} & \begin{array} { l } \text { Conversion Costs } \\\text { (Percent Complete) }\end{array} \\\hline \text { Beginning work in process inventory } & 9,000 & 60 \% \\\hline \text { Units started into production } & 45,000 & - \\\hline \text { Units completed and transferred out } & 46,000 & - \\\hline \text { Ending work in process inventory } & 8,000 & 25 \% \\\hline\end{array}$$ All materials are added prior to the beginning of work in the Blending Department.

-Assuming that Tru-Colour Paint Company uses the weighted-average method, the equivalent units of production for materials would be?

A)54,000 units.
B)48,000 units.
C)45,000 units.
D)46,000 units.

Question 31

Lucas Company uses the weighted-average method in its process costing system.

A)$6,120.
B)$5,520.
C)$3,060.
D)$6,000.

Question 32

Reference: 04-06
The information below was obtained from the records of the first processing department of Christine Corporation for the month of July. The company uses the weighted-average method in its process costing system. $$\begin{array} { | l | l | l | } \hline & \text { Units } & \begin{array} { l } \text { Labour and Overhead } \\\text { (Percentage Complete) }\end{array} \\\hline \text { Work in process inventory, July 1 } & 20,000 & 40 \% \\\hline \text { Started during the month } & 70,000 & \\\hline \text { Completed during the month } & 80,000 & \\\hline \text { Work in process inventory, July 31 } & ? & 25 \% \\\hline\end{array}$$ All materials are added at the beginning of the manufacturing process.

-The equivalent units of production for labour and overhead for the month are

A)70,000 units.
B)90,000 units.
C)82,500 units.
D)80,000 units.

Question 33

Narver Company uses the weighted-average method in its process costing system. Operating data for the Lubricating Department for the month of October appear below: $$\begin{array} { | l | l | l | } \hline & \text { Uhirs } & \text { Percentage complefe } \\\hline \text { Beginning work in grocess inventory } & 8,600 & 60 \% \\\hline \text { Transferred in from the prior } & & \\\hline \text { department during October } & 40,100 & \\\hline \text { Completed and transferred to the next } & & \\\hline \text { department during October } & 37,100 & \\\hline \text { Ending work in process inventory } & 9,600 & 80 \% \\\hline\end{array}$$ What were the equivalent units of production for conversion costs in the Lubricating
Department for October?

A)44,780.
B)43,100.
C)37,100.
D)47,780.

Question 34

Reference: 04-12
GK Manufacturing had inventory at May 1 of 5,000 units which were 70% complete as to conversion costs. The
May 1 inventory had total costs of $ 69,900 which included $ 21,500 direct materials, $ 38,775 direct labour and
$ 9,625 factory overhead.
Costs added to work in process in May were as follows: $$\begin{array} { | l | l | } \hline \text { Direct materials } & \$ 298,800 \\\hline \text { Direct labour } & \$ 540,800 \\\hline \text { Factory overhead } & \$ 135,400 \\\hline\end{array}$$ During May, 49,200 units were completed, including those in inventory on May 1. On May 30, the inventory of work in process consisted of 5,600 units which were 3/8 completed as to conversion costs. Inventories are costed by the first-in, first-out method and all materials are added at the beginning of the process.

-What was the material cost per equivalent unit for May

A)$6.06.
B)$6.45.
C)$6.00.
D)$6.25.

Question 35

Reference: 04-12
GK Manufacturing had inventory at May 1 of 5,000 units which were 70% complete as to conversion costs. The
May 1 inventory had total costs of $ 69,900 which included $ 21,500 direct materials, $ 38,775 direct labour and
$ 9,625 factory overhead.
Costs added to work in process in May were as follows: $$\begin{array} { | l | l | } \hline \text { Direct materials } & \$ 298,800 \\\hline \text { Direct labour } & \$ 540,800 \\\hline \text { Factory overhead } & \$ 135,400 \\\hline\end{array}$$ During May, 49,200 units were completed, including those in inventory on May 1. On May 30, the inventory of work in process consisted of 5,600 units which were 3/8 completed as to conversion costs. Inventories are costed by the first-in, first-out method and all materials are added at the beginning of the process.

-What were the equivalent units of production for material costs for May

A)49,200 units.
B)49,800 units.
C)47,800 units.
D)46,300 units.

Question 36

Rariton Company uses the weighted-average method in its process costing system.

A)$4,081.20.
B)$10,310.40
C)$6,121.80.
D)$10,203.00.

Question 37

Reference: 04-05
The following data relate to the Blending Department of Tru-Colour Paint Company for a recent month: $$\begin{array} { | l | l | l | } \hline & \begin{array} { l } \text { Number of } \\\text { Units }\end{array} & \begin{array} { l } \text { Conversion Costs } \\\text { (Percent Complete) }\end{array} \\\hline \text { Beginning work in process inventory } & 9,000 & 60 \% \\\hline \text { Units started into production } & 45,000 & - \\\hline \text { Units completed and transferred out } & 46,000 & - \\\hline \text { Ending work in process inventory } & 8,000 & 25 \% \\\hline\end{array}$$ All materials are added prior to the beginning of work in the Blending Department.

-Assuming that Tru-Colour Paint Company uses the weighted-average method, the equivalent units of production for conversion costs would be?

A)42,600 units.
B)46,000 units.
C)48,000 units.
D)44,400 units.

Question 38

In a process cost system, transferred-in costs represent

A)manufacturing overhead costs applied to the products processed.
B)costs from external suppliers for materials used in processing.
C)direct labour and manufacturing overhead costs incurred in processing.
D)costs attached to partially completed units that have been received from a prior processing department.

Question 39

Fabian Company uses the weighted-average method in its process costing system. The Assembly Department started the month with 9,000 units in its beginning work in process inventory that were 70% complete with respect to conversion costs. An additional 90,000 units were transferred in from the prior department during the month to begin processing in the Assembly Department. During the month 87,000 units were completed in the Assembly Department and transferred to the next processing department. There were 12,000 units in the ending work in process inventory of the Assembly Department that were 20% complete with respect to conversion costs.
What were the equivalent units of production for conversion costs in the Assembly
Department for the month?

A)89,400.
B)83,100.
C)93,000.
D)87,100.

Question 40

Reference: 04-01
A sporting goods manufacturer buys wood as a direct material for baseball bats. The Forming Department processes the baseball bats, and the bats are then transferred to the Finishing Department where a sealant is applied. There was no beginning work in process inventory in the Forming Department in May. The Forming Department began manufacturing 10,000 Casey Slugger baseball bats during May. Costs for the Forming Department for the month of May were as follows: $$\begin{array} { | l | l | } \hline \text { Direct materials } & \$ 33,000 \\\hline \text { Conversion costs } & \$ 17,000 \\\hline\end{array}$$ A total of 8,000 bats were completed and transferred to the Finishing Department during May. The ending work in process inventory was 100% complete with respect to direct materials and 25% complete with respect to conversion costs. The company uses the weighted-average method of process costing.

-The cost of the work in process inventory in the Finishing Department at the end of May was?

A)$ 7,600.
B)$ 4,000.
C)$10,000.
D)$ 2,500.

Question 41

Reference: 04-01
A sporting goods manufacturer buys wood as a direct material for baseball bats. The Forming Department processes the baseball bats, and the bats are then transferred to the Finishing Department where a sealant is applied. There was no beginning work in process inventory in the Forming Department in May. The Forming Department began manufacturing 10,000 Casey Slugger baseball bats during May. Costs for the Forming Department for the month of May were as follows: $$\begin{array} { | l | l | } \hline \text { Direct materials } & \$ 33,000 \\\hline \text { Conversion costs } & \$ 17,000 \\\hline\end{array}$$ A total of 8,000 bats were completed and transferred to the Finishing Department during May. The ending work in process inventory was 100% complete with respect to direct materials and 25% complete with respect to conversion costs. The company uses the weighted-average method of process costing.

-The cost of the units transferred to the Finishing Department during May was

A)$50,000.
B)$42,400.
C)$53,000.
D)$40,000.

Question 42

Reference: 04-09
Kimbeth Manufacturing makes Dust Density Sensors (DDS), a safety device for the mining industry. The company uses a process costing system and has only a single processing department. The following information pertains to operations for the month of May: $\begin{array}{|l|l|}\hline & \text { Units } \\\hline \text { Beginning work in process inventory } & 16,000 \\\hline \text { Started into production during May } & 100,000 \\\hline \text { Completed during May } & 92,000 \\\hline \text { Ending work in process inventory } & 24,000 \\\hline\end{array}$
The beginning work in process inventory was $60 \%$ complete with respect to materials and $20 \%$ complete with respect to conversion costs. The ending work in process inventory was $90 \%$ complete with respect to materials and $40 \%$ complete with respect to conversion costs. The costs were as follows:
$\begin{array}{|l|l|l|}\hline & \text { Conversion } & \text { Materials } \\\hline \text { Beginning work in process inventory } & \$ 54,560 & \$ 35,560 \\\hline \text { Costs incurred during May } & \$ 468,000 & \$ 574,040 \\\hline\end{array}$

-Using the weighted-average method, the cost per equivalent unit of conversion cost for May is

A)$5.14.
B)$5.68.
C)$6.41.
D)$6.00.

Question 43

The Nichols Company uses the weighted-average method in its process costing system. The company recorded 29,500 equivalent units of production for conversion costs for November in a particular department. There were 6,000 units in the ending work in process inventory on November 30, 75% complete with respect to conversion costs. The November 1 work in process inventory consisted of 8,000 units, 50% complete with respect to conversion costs. A total of 25,000 units were completed and transferred out
Of the department during the month. The number of units started during November in the department was?

A)21,000 units.
B)24,500 units.
C)27,000 units.
D)23,000 units.

Question 44

Reference: 04-09
Kimbeth Manufacturing makes Dust Density Sensors (DDS), a safety device for the mining industry. The company uses a process costing system and has only a single processing department. The following information pertains to operations for the month of May: $\begin{array}{|l|l|}\hline & \text { Units } \\\hline \text { Beginning work in process inventory } & 16,000 \\\hline \text { Started into production during May } & 100,000 \\\hline \text { Completed during May } & 92,000 \\\hline \text { Ending work in process inventory } & 24,000 \\\hline\end{array}$
The beginning work in process inventory was $60 \%$ complete with respect to materials and $20 \%$ complete with respect to conversion costs. The ending work in process inventory was $90 \%$ complete with respect to materials and $40 \%$ complete with respect to conversion costs. The costs were as follows:
$\begin{array}{|l|l|l|}\hline & \text { Conversion } & \text { Materials } \\\hline \text { Beginning work in process inventory } & \$ 54,560 & \$ 35,560 \\\hline \text { Costs incurred during May } & \$ 468,000 & \$ 574,040 \\\hline\end{array}$

-Using the FIFO method, the equivalent units for materials are closest to

A)154,800 units.
B)113,600 units.
C)120,000 units.
D)104,000 units.

Question 45

The Assembly Department started the month with 35,000 units in its beginning work in process inventory. An additional 472,000 units were transferred in from the prior department during the month to begin processing in the Assembly Department. There were 34,000 units in the ending work in process inventory of the Assembly Department. How many units were transferred to the next processing department during the month?

A)473,000.
B)507,000.
C)471,000.
D)541,000.

Question 46

Reference: 04-10
Nando Company uses the weighted-average method in its process costing system. Department J is the second of three sequential processes at the company. During October, Department J collected the following data: $$\begin{array}{l}\begin{array} { | l | l | l | } \hline & \text { Units } & \begin{array} { l } \text { Labour and Overhead } \\\text { (Percentage Complete) }\end{array} \\\hline \text { Work in process, October 1 } & 8,000 & 60 \% \\\hline \text { Units started } & 25,000 & \\\hline \text { Completed and transferred } & 20,000 & \\\hline \text { Work in process, October } 31 & 13,000 & 20 \% \\\hline\end{array}\\\\\begin{array} { | l | l | l | l | } \hline \text { Costs for October: } & \text { Transferred In } & \text { Materials } & \begin{array} { l } \text { Labour and } \\\text { Overhead }\end{array} \\\hline \text { Work in process, October 1 } & \$ 33,000 & \$ 16,500 & \$ 31,200 \\\hline \text { Added during the month } & \$ 59,400 & \$ 82,500 & \$ 194,800 \\\hline\end{array}\end{array}$$ All materials are added at the beginning of the process.

-The total cost assigned to ending work in process inventory was

A)$152,800.
B)$ 59,000.
C)$75,400.
D)$101,400.

Question 47

Reference: 04-12
GK Manufacturing had inventory at May 1 of 5,000 units which were 70% complete as to conversion costs. The
May 1 inventory had total costs of $ 69,900 which included $ 21,500 direct materials, $ 38,775 direct labour and
$ 9,625 factory overhead.
Costs added to work in process in May were as follows: $$\begin{array} { | l | l | } \hline \text { Direct materials } & \$ 298,800 \\\hline \text { Direct labour } & \$ 540,800 \\\hline \text { Factory overhead } & \$ 135,400 \\\hline\end{array}$$ During May, 49,200 units were completed, including those in inventory on May 1. On May 30, the inventory of work in process consisted of 5,600 units which were 3/8 completed as to conversion costs. Inventories are costed by the first-in, first-out method and all materials are added at the beginning of the process.

-What was the conversion cost per equivalent unit for May

A)$21.86.
B)$12.81.
C)$14.15.
D)$15.18.

Question 48

Reference: 04-08
Information about units processed and processing costs incurred during a recent month in the Blending
Department of a manufacturing company follow: $$\begin{array} { | l | l | l | } \hline & \begin{array} { l } \text { Number of } \\\text { Units }\end{array} & \begin{array} { l } \text { Conversion Costs } \\\text { (Percent Completion) }\end{array} \\\hline \text { Beginning work in process inventory } & 11,000 & 35 \% \\\hline \text { Units started into production } & 120,000 & - \\\hline \text { Units completed and transferred out } & 114,000 & - \\\hline \text { Ending work in process inventory } & 17,000 & 30 \% \\\hline\end{array}$$ The beginning work in process inventory included $11,000 of conversion cost and $ 12,000 in material costs. During the month, the Department incurred an additional $290,000 in conversion costs and $ 143,000 in material costs. All materials are added at the beginning of production in each department.

-Assuming that the company uses the weighted-average cost method, what is the cost per equivalent unit for conversion costs for the month in the Blending Department

A)$2.53.
B)$2.55.
C)$2.50.
D)$2.44.

Question 49

Process costing would be appropriate for each of the following except

A)oil refining.
B)grain milling.
C)newsprint production.
D)custom furniture.

Question 50

The Richmond Company uses the weighted-average method in its process costing system.

A)$75,600.
B)$80,100.
C)$126,000.
D)$95,400.

Question 51

Reference: 04-09
Kimbeth Manufacturing makes Dust Density Sensors (DDS), a safety device for the mining industry. The company uses a process costing system and has only a single processing department. The following information pertains to operations for the month of May: $\begin{array}{|l|l|}\hline & \text { Units } \\\hline \text { Beginning work in process inventory } & 16,000 \\\hline \text { Started into production during May } & 100,000 \\\hline \text { Completed during May } & 92,000 \\\hline \text { Ending work in process inventory } & 24,000 \\\hline\end{array}$
The beginning work in process inventory was $60 \%$ complete with respect to materials and $20 \%$ complete with respect to conversion costs. The ending work in process inventory was $90 \%$ complete with respect to materials and $40 \%$ complete with respect to conversion costs. The costs were as follows:
$\begin{array}{|l|l|l|}\hline & \text { Conversion } & \text { Materials } \\\hline \text { Beginning work in process inventory } & \$ 54,560 & \$ 35,560 \\\hline \text { Costs incurred during May } & \$ 468,000 & \$ 574,040 \\\hline\end{array}$

-Using the weighted-average method, the cost per equivalent unit of materials for May is

A)$5.37.
B)$6.63.
C)$5.00.
D)$5.05.

Question 52

Reference: 04-02
Adam Company uses the weighted-average method in its process costing system. The following information for the Assembly Department was obtained from the accounting records for September (all materials are added at the
beginning of the process): $$\begin{array}{l}\begin{array} { | l | l | l | } \hline & \begin{array} { l } \text { Number of } \\\text { Units }\end{array} & \begin{array} { l } \text { Labour and Overhead } \\\text { (Percentage Complete } )\end{array} \\\hline \text { Work in process inventory, Sept. 1 } & 60,000 & 15 \% \\\hline \text { Transferred in during the month } & 105,000 & \\\hline \text { Work in process inventory, Sept. } 30 & 40,000 & 20 \% \\\hline\end{array}\\\\\begin{array} { | c | l | l | l | } \hline & \text { Transferred In } & \text { Materials } & \begin{array} { l } \text { Labour \& } \\\text { Overhead }\end{array} \\\hline \text { Beginning work in } & & & \\\hline \text { process inventory } & \$ 60,000 & \$ 30,000 & \$ 16,000 \\\hline \text { Cost added during the month } & \$ 115,500 & \$ 63,000 & \$ 320,000 \\\hline\end{array}\end{array}$$

-The "Cost to be accounted for" section of the production report for the month will show a total amount equal to?

A)$498,500.
B)$429,000.
C)$106,000.
D)$604,500.

Question 53

Strap Company uses the weighted-average method in its process costing system. The company has only one processing department. The ending work in process inventory consists of 10,000 units, 60% complete with respect to materials. The total dollar value of this inventory is $38,000. The costs per equivalent unit are $5.00 for materials and $4.00 for conversion costs for the period. With respect to conversion costs, the ending work in process inventory is?

A)20% complete.
B)30% complete.
C)38% complete.
D)10% complete.

Question 54

Reference: 04-03
Madsen Company uses the weighted-average method in its process costing system. During October, the Mixing Department transferred out 40,000 units. The October 31 work in process inventory in the Mixing Department consisted of 4,000 equivalent units of material and 5,000 equivalent units of labour and overhead. The cost per equivalent unit was $2.50 for materials and $6.25 for labour and overhead.
The "Cost to account for" section of the production report for October will show a total amount equal to

A)$110,000.
B)$428,750.
C)$350,000.
D)$391,250.

Question 55

David Company uses the weighted-average method in its process costing system.

A)$5.988.
B)$7.547.
C)$7.700.
D)$4.634.

Question 56

Reference: 04-03
Madsen Company uses the weighted-average method in its process costing system. During October, the Mixing Department transferred out 40,000 units. The October 31 work in process inventory in the Mixing Department consisted of 4,000 equivalent units of material and 5,000 equivalent units of labour and overhead. The cost per equivalent unit was $2.50 for materials and $6.25 for labour and overhead.
The total cost of the October 31 work in process inventory was?

A)$35,000.
B)$43,750.
C)$78,750.
D)$41,250.

Question 57

Reference: 04-11
The following data relate to the Forming Department of Jimbob Co. for a recent month: $$\begin{array} { | l | l | l | } \hline & \begin{array} { l } \text { Number of } \\\text { Units }\end{array} & \begin{array} { l } \text { Conversion Costs } \\\text { (Percent Complete) }\end{array} \\\hline \text { Beginning work in process inventory } & 9,000 & 60 \% \\\hline \text { Units started into production } & 45,000 & - \\\hline \text { Units completed and transferred out } & 46,000 & - \\\hline \text { Ending work in process inventory } & 8,000 & 25 \% \\\hline\end{array}$$ All materials are added prior to the beginning of work in the Forming Department.

-Assuming that Jimbob Co. uses the FIFO method, the equivalent units of production for conversion costs would be?

A)48,000 units.
B)46,000 units.
C)42,600 units.
D)44,400 units.

Question 58

Reference: 04-02
Adam Company uses the weighted-average method in its process costing system. The following information for the Assembly Department was obtained from the accounting records for September (all materials are added at the
beginning of the process): $$\begin{array}{l}\begin{array} { | l | l | l | } \hline & \begin{array} { l } \text { Number of } \\\text { Units }\end{array} & \begin{array} { l } \text { Labour and Overhead } \\\text { (Percentage Complete) }\end{array} \\\hline \text { Work in process inventory, Sept. 1 } & 60,000 & 15 \% \\\hline \text { Transferred in during the month } & 105,000 & \\\hline \text { Work in process inventory, Sept. } 30 & 40,000 & 20 \% \\\hline\end{array}\\\\\begin{array} { | c | l | l | l | } \hline & \text { Transferred In } & \text { Materials } & \begin{array} { l } \text { Labour \& } \\\text { Overhead }\end{array} \\\hline \text { Beginning work in } & & & \\\hline \text { process inventory } & \$ 60,000 & \$ 30,000 & \$ 16,000 \\\hline \text { Cost added during the month } & \$ 115,500 & \$ 63,000 & \$ 320,000 \\\hline\end{array}\end{array}$$

-The equivalent units of production for material for the month are?

A)105,000 units.
B)165,000 units.
C)122,000 units.
D)145,000 units.

Question 59

$$\begin{array} { | l | l | l | } \hline & \text { Materials } & \text { Conversion Cost } \\\hline \text { Work in process, beginning } & \$ 8,000 & \$ 6,000 \\\hline \text { Current added during January } & \$ 40,000 & \$ 32,000 \\\hline \text { Equivalent units of production } & 100,000 & 95,000 \\\hline \text { Cost per equivalent unit } & \$ 0.48 & \$ 0.40 \\\hline \begin{array} { l } \text { Units completed and transferred to the next } \\\text { department }\end{array} & 90,000 \text { units } & \\\hline \text { Work in process, ending } & 10,000 \text { units } & \\\hline\end{array}$$ Materials are added at the beginning of the process. The ending work in process is 50% complete with respect to conversion costs. What cost would be recorded for the ending work in process inventory?

A)$8,800.
B)$4,400.
C)$6,800.
D)$3,400.

Question 60

Jimbob Co. uses the weighted-average method in its process costing system. The company adds all required materials at the beginning of the process in Department A, which is the first of two stages in its production process. Information concerning operations in the Department A in October follows: $$\begin{array} { | l | l | l | } \hline & \text { Units } & \text { Materials Cost } \\\hline \text { Work in process on October 1 } & 6,000 & \$ 3,000 \\\hline \text { Units started during October } & 50,000 & \$ 25,560 \\\hline \text { Units completed and transferred to } & & \\\hline \text { the next Department during October } & 44,000 & \\\hline\end{array}$$ What were the equivalent units of production in Department A in October?

A)6,000 units.
B)44,000 units.
C)12,000 units.
D)56,000 units.

Question 61

If the costs for direct labour, factory overhead and direct material were $873,600,
$109,200 and $53,200 respectively for 28,000 equivalent units of production, the conversion cost per equivalent unit was $11.60.

Question 62

In a processing system where labour costs represent a significant portion of total processing costs, it may be useful to track the three categories of processing costs separately - materials, labour and manufacturing overhead costs.

Question 63

Which of the following costs incurred by a paper manufacturer would be included in the group of costs referred to as conversion costs?

A)machine operator's wages.
B)sales person salaries.
C)lumber.
D)advertising costs.

Question 64

If a business wishes to track the costs of completing units in beginning work in process, the first-in-first-out (FIFO)method should be used.

Question 65

Instead of using a job cost sheet, production reports are prepared for each department (or process)to accumulate costs of production and to account for units worked on.

Question 66

In order to use process costing, the output of a processing department must be
homogeneous.

Question 67

The following journal entry would be made in a process costing system when units that have been completed with respect to the work done in Processing Department Z are transferred from Processing Department Z to Processing Department Y:
$$\begin{array} { | c | l | l | } \hline \text { Work in Process, Department Y } & \mathrm { XXX } & \\\hline \text { Work in Process, Department Z } & & \mathrm { XXX } \\\hline\end{array}$$

Question 68

A manufacturer of blank CDs would ordinarily use process costing rather than job-order costing.

Question 69

In a sequential manufacturing system (all units produced flow in the same direction through all departments), the production report of the final department will include all manufacturing costs of units produced.

Question 70

In process costing, the same equivalent units figure is always used for both materials and conversion costs.

Question 71

The following journal entry would be made in a process costing system when units that have been completed with respect to the work done in the final processing department are transferred to the finished goods warehouse:
$$\begin{array} { | c | l | l | } \hline \text { Finished Goods } & \mathrm { XXX } & \\\hline \text { Materials } & & \mathrm { XXX } \\\hline\end{array}$$

Question 72

The following data were taken from the accounting records of the Hazel Corporation which uses the weighted-average method in its process costing system: $$\begin{array} { | c | l | } \hline \text { Beginning work in process inventory } & \\\hline ( 100 \% \text { complete as to materials; } & \\\hline 70 \% \text { complete as to conversion) } & 30,000 \text { units } \\\hline \text { Started in process during the period } & 90,000 \text { units } \\\hline \text { Ending work in process inventory } & \\\hline ( 100 \% \text { complete as to materials; } & \\\hline 60 \% \text { complete as to conversion) } & 20,000 \text { units } \\\hline\end{array}$$ The equivalent units of production for conversion costs were?

A)102,000.
B)112,000.
C)111,000.
D)100,000.

Question 73

Glo Co., a manufacturer of combs, uses the weighted-average method in its process costing system. The company sold 125,000 units during the month of April. There is only one processing department. The following additional information is provided: $$\begin{array} { | l | l | } \hline \text { Inventory at April 1: } & \\\hline \text { Work in process } & \text { None } \\\hline \text { Finished goods } & 37,500 \text { units } \\\hline \text { Inventory at April 30: } & \\\hline \text { Work in process (75\% complete } & \\\hline \text { as to conversion costs) } & 8,000 \text { units } \\\hline \text { Finished goods } & 30,000 \text { units } \\\hline\end{array}$$ What were the equivalent units of production for conversion costs for April?

A)123,500.
B)117,500.
C)125,500.
D)126,500.

Question 74

Harker Company uses the weighted-average method in its process costing system.

A)$4.176.
B)$4.600.
C)$4.421.
D)$3.375.

Question 75

If a business has substantial amounts of manufactured inventory, both the
first-in-first-out (FIFO)method and the weighted-average method will be very useful in assessing cost control.

Question 76

If a business wishes to track the costs of completing units in beginning work in process, the weighted-average method should be used.

Question 77

Reference: 04-08
Information about units processed and processing costs incurred during a recent month in the Blending
Department of a manufacturing company follow:
$$\begin{array} { | l | l | l | } \hline & \begin{array} { l } \text { Number of } \\\text { Units }\end{array} & \begin{array} { l } \text { Conversion Costs } \\\text { (Percent Completion) }\end{array} \\\hline \text { Beginning work in process inventory } & 11,000 & 35 \% \\\hline \text { Units started into production } & 120,000 & - \\\hline \text { Units completed and transferred out } & 114,000 & - \\\hline \text { Ending work in process inventory } & 17,000 & 30 \% \\\hline\end{array}$$ The beginning work in process inventory included $11,000 of conversion cost and $ 12,000 in material costs. During the month, the Department incurred an additional $290,000 in conversion costs and $ 143,000 in material costs. All materials are added at the beginning of production in each department.

-Assuming that the company uses the weighted-average cost method, what are the equivalent units of production for conversion costs for the Blending Department for the month?

A)119,100 units.
B)131,000 units.
C)120,000 units.
D)114,000 units.

Question 78

When computing the cost per equivalent unit, it is not necessary to consider the percentage completion of the units in beginning inventory under the weighted-average method.

Question 79

In process costing, costs are accumulated in processing departments, rather than by job.

Question 80

The cost reconciliation prepared within a department's periodic production report is only
used for the purpose of costing the units completed and transferred out of the department during the period (either to another department or to finished goods).