Deck 4: How Is Process Costing Used to Track Production Costs

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Question
Two important double-checks included in a production cost report are: (1)units to be accounted for matches units accounted for and (2)total costs to be accounted for matches total costs accounted for.
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Question
If 10 physical units of product are 30 percent complete at the end of the period,an equivalent of 3 completed units will be used for process costing calculations.
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When using process costing,only one companywide Work-in-Process account is allowed for tracking product costs.
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A job costing system would be appropriate for an oil refinery.
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Most companies use either the weighted average or specific identification method to assign costs to inventory in a process costing environment.
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For a manufacturing company using process costing,cost per equivalent unit is only calculated for direct labor and direct materials.
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A company that uses process costing may use several Work-in-Process Inventory accounts.
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In a process costing system,partially completed units in Work-in-Process Inventory are typically converted to equivalent completed units.
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When units are transferred from one production process to another,the journal entry will include a debit and a credit to two different Work-in-Process Inventory accounts.
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A process costing system is used by companies that produce similar or identical units of product.
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Process costing is typically used by service companies that have one department.
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A company producing the following product will likely not use process costing?

A)Milk
B)Custom built yachts
C)Oil
D)soda
E)None of the answer choices is correct.
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Both process costing and job costing typically include three product costs direct materials,direct labor,and manufacturing overhead.
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In a process costing system,the first step is to summarize the physical flow of units so that Units to be accounted for equals Units sold.
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A bike repair shop would most likely use a process costing system.
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Because direct materials,direct labor,and overhead may enter a process at varying stages,equivalent units in Work-in-Process Inventory may be different for each of these components of production.
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When using a process costing system,product costs are tracked by department rather than by job.
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The unit cost information for process costing comes from the departmental production cost report.
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In a process costing system,the department where production begins will never have transferred-in costs from another department.
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The production cost report is often prepared using computerized software to minimize math errors and to speed up the process.
Question
Diaz Company uses process costing in its two processing departments Assembly and Finishing.If the direct labor costs incurred for the Assembly Department totaling $15,000 are to be paid next month,which one of the following journal entries would be made to record this transaction?
a.
 Wages Payable 15,000 Wages Expense 15,000\begin{array}{llr} \text { Wages Payable } &15,000\\ \text { Wages Expense } &&15,000\\\end{array}

b.
WIP Inventory - Assembly 15,000Wages Payable 15,000\begin{array}{llr} \text {WIP Inventory - Assembly } &15,000\\ \text {Wages Payable } &&15,000\\\end{array}

c.
Wages Payable 15,000 WIP Inventory - Assembly15,000\begin{array}{llr} \text {Wages Payable } &15,000\\ \text { WIP Inventory - Assembly} &&15,000\\\end{array}

d.
Wages Expense 15,000 WIP Inventory - Assembly 15,000\begin{array}{llr} \text {Wages Expense } &15,000\\ \text { WIP Inventory - Assembly } &&15,000\\\end{array}

e.  None of the answer choices is correct.\text { None of the answer choices is correct.}
Question
If a processing department has no beginning WIP Inventory,and the ending WIP Inventory is 100% complete as to material costs,the number of equivalent units for material costs is:

A)always equal to zero.
B)equal to the units completed.
C)less than the units placed into the process.
D)equal to the units placed into the process.
E)None of the answer choices is correct.
Question
Equivalent units are usually applied to:

A)only direct materials and direct labor.
B)only direct materials and overhead.
C)only direct labor.
D)direct materials,direct labor,and overhead.
E)None of the answer choices is correct.
Question
Using a process costing system,the journal entry to record the requisition of direct materials to be used in production includes:

A)a debit to Raw Materials Inventory
B)a debit to Manufacturing Overhead
C)a credit to Raw Material Inventory
D)a credit to Work in Process Inventory
E)None of the answer choices is correct.
Question
Using a process costing system,the journal entry to record the cost of completed goods when sold includes:

A)a debit to Finished Goods Inventory.
B)a credit to Cost of Goods Sold.
C)a debit to Work in Process Inventory.
D)a credit to Finished Goods Inventory.
E)None of the answer choices is correct.
Question
Diaz Company uses process costing in its two processing departments Assembly and Finishing.If the Finishing Department is the final production department and completes product with a production cost of $15,000,which one of the following journal entries would be made to record this transaction?
a.
 Cost of Goods Sold 15,000 WIP Inventory - Finishing 15,000\begin{array}{llr} \text { Cost of Goods Sold } &15,000\\ \text { WIP Inventory - Finishing } &&15,000\\\end{array}

b.
 Finished Goods Inventory 15,000 Cost of Goods Sold 15,000\begin{array}{llr} \text { Finished Goods Inventory } &15,000\\ \text { Cost of Goods Sold } &&15,000\\\end{array}

c.
WIP Inventory - Finishing 15,000Finished Goods Inventory 15,000\begin{array}{llr} \text {WIP Inventory - Finishing } &15,000\\ \text {Finished Goods Inventory } &&15,000\\\end{array}

d.
Finished Goods Inventory 15,000WIP Inventory - Finishing 15,000\begin{array}{llr} \text {Finished Goods Inventory } &15,000\\ \text {WIP Inventory - Finishing } &&15,000\\\end{array}

e. None of the answer choices is correct.\text {None of the answer choices is correct.}
Question
Diaz Company uses process costing in its two processing departments; Assembly and Finishing.If the Assembly Department requisitioned direct materials to be used in production,totaling $80,000,which one of the following journal entries would be made to record this transaction?
a.
 WIP Inventory - Assembly 80,000 WIP Inventory - Materials 80,000\begin{array}{ll}\text { WIP Inventory - Assembly } &80,000\\\text { WIP Inventory - Materials }&&80,000\end{array}

b.
 Raw Materials Inventory 80,000 WIP Inventory - Assembly 80,000\begin{array}{ll}\text { Raw Materials Inventory } &80,000\\\text { WIP Inventory - Assembly }&&80,000\end{array}

c.
 WIP Inventory - Assembly 80,000 Raw Materials Inventory 80,000\begin{array}{ll}\text { WIP Inventory - Assembly }&80,000 \\\text { Raw Materials Inventory }&&80,000\end{array}

d.
 Cost of Goods sold 80,000 Finished Goods Inventory 80,000\begin{array}{ll} \text { Cost of Goods sold } & 80,000 \\\text { Finished Goods Inventory }&&80,000 \end{array}

e.  None of the answer choices is correct. \text { None of the answer choices is correct. }
Question
If ending inventory in the Distilling Department consists of 6,000 units which are 100% complete with respect to direct materials and 40% complete with respect to direct labor and overhead,what are the number of equivalent units for direct materials,direct labor,and overhead?

A)Direct materials = 6,000 units;direct labor = 6,000 units;overhead = 6,000 units
B)Direct materials = 2,400 units;direct labor = 2,400 units;overhead = 2,400 units
C)Direct materials = 6,000 units;direct labor = 2,400 units;overhead = 2,400 units
D)Direct materials = 6,000 units;direct labor = 2,400 units;overhead = 6,000 units
E)None of the answer choices is correct.
Question
Using a process costing system,the journal entry to record the use of direct labor in the Finishing Department includes:

A)a credit to Wages Payable.
B)a debit to Wages Expense.
C)a credit to Work in Process Inventory - Finishing.
D)a credit to Finished Goods Inventory.
E)None of the answer choices is correct.
Question
The following information is available for the current year for Pike company.
 Number of units in beginning WIP Inventory 12,000 (30% complete)  Number of units started in the current period 160,000 Number of units in the ending WIP Inventory 18,000 (70% complete) \begin{array}{ll}\text { Number of units in beginning WIP Inventory } & 12,000 \quad \text { (30\% complete) } \\\text { Number of units started in the current period } & 160,000 \\\text { Number of units in the ending WIP Inventory } & 18,000 \quad \text { (70\% complete) }\end{array}
If Pike Company uses the weighted average process costing method,what is the total equivalent completed units transferred out and in WIP Inventory?

A)166,000
B)190,000
C)166,600
D)142,000
E)None of the answer choices is correct.
Question
The Molding Department at Miley Corporation had 10,000 units in process on July 1 and 6,000 units in process on July 31.During July,it started 46,000 units.The cost per equivalent unit produced in July was $2.50.If the equivalent units produced in July were 48,000,what were the costs incurred during the month?

A)$105,000
B)$115,000
C)$120,000
D)$150,000
E)None of the answer choices is correct.
Question
Frost Company produces cupcakes in large batches.Three departments are involved in the production process -- Mixing,Baking,and Packaging.Frost uses a process costing system.If products with a cost of $10,000 are transferred from the Mixing Department to the Baking Department for further processing,which of the following journal entries is needed to record this transaction?
a.
 Finished Inventory - Mixing 10,000 Finished Inventory - Baking 10,000\begin{array}{l}\text { Finished Inventory - Mixing } &10,000 \\\text { Finished Inventory - Baking } &&10,000\\\end{array}

b.
 WIP Inventory - Baking 10,000 WIP Inventory - Mixing 10,000\begin{array}{l}\text { WIP Inventory - Baking } &10,000\\\text { WIP Inventory - Mixing } &&10,000\\\end{array}

c.
 WIP Inventory - Mixing 10,000 WIP Inventory - Baking 10,000\begin{array}{l}\text { WIP Inventory - Mixing } &10,000\\\text { WIP Inventory - Baking }&&10,000 \\\end{array}

d.
 Finished Inventory - Baking 10,000 Finished Inventory - Mixing 10,000\begin{array}{l}\text { Finished Inventory - Baking } &10,000 \\\text { Finished Inventory - Mixing }&&10,000\end{array}

e. None of the answer choices is correct.\text {None of the answer choices is correct.}
Question
The journal entry to record the transfer of units from one processing department to another processing department includes:

A)a debit to WIP Inventory.
B)a debit to Finished Goods Inventory.
C)a credit to WIP Inventory.
D)Both a and c are correct.
E)None of the answer choices is correct.
Question
The Packaging Department at Vail Incorporated had 51,000 units in beginning inventory.These units contained $105,000 in direct materials,$120,000 in direct labor,and $90,000 in overhead.During the period,the department incurred costs of $480,000 in direct materials,$600,000 in direct labor and $300,000 in overhead and started 240,000 units.Ending inventory consisted of 18,000 units which were 100% complete with respect to direct materials and 70% complete with respect to direct labor and overhead.How many units were transferred out?

A)309,000
B)291,000
C)282,000
D)273,000
E)None of the answer choices is correct.
Question
Frost Company produces cupcakes in large batches.Three departments are involved in the production process -- Mixing,Baking,and Packaging.Frost uses a process costing system.Assume products with a cost of $9,000 are sold to customers.Which of the following journal entries is needed to record this transaction?
a.
Cost of Goods Sold 9,000 Finished Goods Inventory 9,000\begin{array}{llr} \text {Cost of Goods Sold } &9,000\\ \text { Finished Goods Inventory } &&9,000\\\end{array}

b.
 WIP Inventory - Packaging 9,000 Finished Goods Inventory 9,000\begin{array}{llr} \text { WIP Inventory - Packaging } &9,000\\ \text { Finished Goods Inventory } &&9,000\\\end{array}

c.
 Finished Goods Inventory 9,000 Sales Revenue9,000\begin{array}{llr} \text { Finished Goods Inventory } &9,000\\ \text { Sales Revenue} &&9,000\\\end{array}

d.
 Finished Goods Inventory 9,000Cost of Goods Sold 9,000\begin{array}{llr} \text { Finished Goods Inventory } &9,000\\ \text {Cost of Goods Sold } &&9,000\\\end{array}

e. None of the answer choices is correct.\text {None of the answer choices is correct.}
Question
The number of equivalent units for any input (direct materials,direct labor,or overhead)cannot be greater than:

A)units completed.
B)units to account for.
C)units started.
D)total costs to account for.
E)None of the answer choices is correct.
Question
Diaz Company uses process costing in its two processing departments Assembly and Finishing.If the Assembly Department completes a batch of products with production costs of $30,000 and moves it to the Finishing Department,which one of the following journal entries would be made to record this transaction?
a.
 WIP Inventory - Finishing 30,000 WIP Inventory - Assembly 30,000\begin{array}{ll}\text { WIP Inventory - Finishing } & 30,000 \\\text { WIP Inventory - Assembly } && 30,000 \\\end{array}

b.
 WIP Inventory - Assembly 30,000 WIP Inventory - Finishing 30,000\begin{array}{ll}\text { WIP Inventory - Assembly } & 30,000 \\\text { WIP Inventory - Finishing } && 30,000 \\\end{array}

c.
 Finished Goods Inventory 30,000 WIP Inventory - Assembly 30,000\begin{array}{ll}\text { Finished Goods Inventory } & 30,000 \\\text { WIP Inventory - Assembly } && 30,000 \\\end{array}

d.
 WIP Inventory - Assembly 30,000 Cost of Goods Sold 30,000\begin{array}{ll}\text { WIP Inventory - Assembly } & 30,000 \\\text { Cost of Goods Sold } && 30,000\end{array}

e. None of the answer choices is correct.\text {None of the answer choices is correct.}
Question
Which of the following statements is true regarding cost per equivalent unit?

A)This calculation only includes variable costs.
B)This measure is used to assign costs to units transferred out.
C)This measure always stays the same from one month to the next regardless of different levels of production.
D)The formula to calculate this measure uses total equivalent units accounted for divided by total costs to be accounted for.
E)None of the answer choices is correct.
Question
Diaz Company uses process costing in its two processing departments Assembly and Finishing.If completed goods with a cost of $62,000 are sold,which one of the following journal entries would be made to record this transaction?
a.
Cost of Goods Sold 62,000 Finished Goods Inventory 62,000\begin{array}{llr} \text {Cost of Goods Sold } &62,000\\ \text { Finished Goods Inventory } &&62,000\\\end{array}

b.
Cost of Goods Sold 62,000 Sales Revenue 62,000\begin{array}{llr} \text {Cost of Goods Sold } &62,000\\ \text { Sales Revenue } &&62,000\\\end{array}

c.
WIP Inventory - Assembly 62,000 WIP Inventory - Finishing 62,000\begin{array}{llr} \text {WIP Inventory - Assembly } &62,000\\ \text { WIP Inventory - Finishing } &&62,000\\\end{array}

d.
Finished Goods Inventory 62,000 Cost of Goods Sold 62,000\begin{array}{llr} \text {Finished Goods Inventory } &62,000\\ \text { Cost of Goods Sold } &&62,000\\\end{array}

e. None of the answer choices is correct.\text {None of the answer choices is correct.}
Question
Frost Company produces cupcakes in large batches.Three departments are involved in the production process -- Mixing,Baking,and Packaging.Frost uses a process costing system.If the Mixing Department requisitioned direct materials to be used in production totaling $3,500,which of the following journal entries is needed to record this transaction?
a.
 Raw Materials Inventory 3,500 WIP Inventory - Mixing3,500\begin{array}{llr} \text { Raw Materials Inventory } &3,500\\ \text { WIP Inventory - Mixing} &&3,500\\\end{array}

b.
Finished Goods Inventory 3,500 Raw Materials Inventory 3,500\begin{array}{llr} \text {Finished Goods Inventory } &3,500\\ \text { Raw Materials Inventory } &&3,500\\\end{array}

c.
 WIP Inventory - Mixing 3,500 Mixing Manufacturing Overhead 3,500\begin{array}{llr} \text { WIP Inventory - Mixing } &3,500\\ \text { Mixing Manufacturing Overhead } &&3,500\\\end{array}

d.
 WIP Inventory - Mixing 3,500Raw Materials Inventory 3,500\begin{array}{llr} \text { WIP Inventory - Mixing } &3,500\\ \text {Raw Materials Inventory } &&3,500\\\end{array}

e.  None of the answer choices is correct.\text { None of the answer choices is correct.}
Question
Mathews Company uses the weighted average process costing method.The company had no units in beginning WIP Inventory.Mathews has calculated that 45,000 total equivalent units were completed during the year.If 53,000 units were started in the current period and 10,000 units were in ending WIP Inventory,what percentage of completion existed in the ending inventory units?

A)20%
B)22%
C)56%
D)81%
E)None of the answer choices is correct.
Question
Everlast Inc.had 12,000 units in WIP Inventory at December 1 that were 70% complete with respect to direct labor and overhead.During December,40,000 units were completed.On December 31,the 14,000 units in WIP Inventory were 30% complete as to direct labor and overhead.Direct materials are added at the beginning of the process.How many units were started during December?

A)42,000
B)66,000
C)38,000
D)32,000
E)None of the answer choices is correct.
Question
Calculate the number of equivalent units for each of the following independent cases.
(1) A trade school has 1,000 students enrolled in classes during the current term. The dean is interested in knowing the number of full-time equivalent students enrolled. The average student takes 40% 40 \% of a full load of classes. What is the number of full-time equivalent students?

(2) A total of 8,500 units of product remain in the Finishing Department at the end of the year. Direct materials are 60 percent complete and direct labor is 50 percent complete. What amount of equivalent units remain in the Finishing Department for direct materials and direct labor at year end?

(3) The natal care unit of a Hope Hospital has 50 nurses working on a part-time basis, with the average nurse working 70% 70 \% of a full load. What is the number of full-time equivalent nurses employed by the hospital?

(4) A total of 3,000 units of product remain in the Fabricating Department at the end of the year. These products are 45% 45 \% complete with respect to direct materials and 20% 20 \% complete in terms of direct labor. What is the equivalent units remaining in the Fabrication Department for direct materials and direct labor at year end?.
Question
Exhibit 4-1
Silva Coporation uses the weighted average process costing method.The Mixing Department at Silva had 17,000 units in beginning inventory.These units contained $70,000 in direct materials,$80,000 in direct labor,and $60,000 in overhead.During the period,the department incurred costs of $320,000 in direct materials,$400,000 in direct labor and $200,000 in overhead and started 80,000 units.Ending inventory consisted of 6,000 units which were 100% complete with respect to direct materials and 50% complete with respect to direct labor and overhead.
Refer to Exhibit 4-1.What is the cost per equivalent unit for direct labor (rounded to the nearest cent)?

A)$5.28
B)$5.11
C)$4.94
D)$0.86
E)None of the answer choices is correct.
Question
Match between columns
Premises:
A company that builds bridges
A company that builds bridges
Motor oil manufacturer
Motor oil manufacturer
Responses:
job costing
process costing
job costing
process costing
job costing
process costing
job costing
process costing
job costing
process costing
job costing
process costing
job costing
process costing
job costing
process costing
Question
Exhibit 4-1
Silva Coporation uses the weighted average process costing method.The Mixing Department at Silva had 17,000 units in beginning inventory.These units contained $70,000 in direct materials,$80,000 in direct labor,and $60,000 in overhead.During the period,the department incurred costs of $320,000 in direct materials,$400,000 in direct labor and $200,000 in overhead and started 80,000 units.Ending inventory consisted of 6,000 units which were 100% complete with respect to direct materials and 50% complete with respect to direct labor and overhead.
Refer to Exhibit 4-1.What is the total cost of units transferred out?

A)$1,221,580
B)$1,150,420
C)$1,079,260
D)$1,082,900
E)None of the answer choices is correct.
Question
The ending WIP Inventory in the Assembly Department contains 800 units that are 100% complete with respect to direct materials and 80% complete with respect to direct labor and overhead.The cost per equivalent unit for inventory is $3.00,which consists of $2.00 for materials,$0.80 for labor,and $0.20 for overhead.What dollar value is assigned to the ending WIP Inventory?

A)$1,600
B)$512
C)$128
D)$2,240
E)None of the answer choices is correct.
Question
Exhibit 4-2
Chem Company makes chemicals and uses the weighted average process costing method.The company has two processing departments - Mixing and Packaging.They had no beginning inventories for April and the percentages of completion were 50% for direct materials,direct labor,and overhead.
 Mixing  Packaging  Gallons of chemical completed during April 90,00090,000 Gallons of chemical on hand at April 30 (50% complete) 8,0000 Production costs incurred $47,000$153,000\begin{array}{lrc} & \underline{\text { Mixing } }& \underline{\text { Packaging }} \\ \text { Gallons of chemical completed during April }& 90,000 & 90,000 \\\text { Gallons of chemical on hand at April 30 (50\% complete) } & 8,000 & 0 \\\text { Production costs incurred } & \$ 47,000 & \$ 153,000\end{array}


-Refer to Exhibit 4-2.What is the cost per gallon for the packaging process?

A)$1.66
B)$1.78
C)$1.70
D)$1.56
E)None of the answer choices is correct.
Question
The cost per equivalent unit in the production cost report equals the "costs to be accounted for" divided by the number of:

A)units sold.
B)equivalent units produced.
C)units completed.
D)units started.
E)None of the answer choices is correct.
Question
The production cost report does all the following except:

A)calculates production for the next period.
B)shows the equivalent units of production.
C)helps in controlling costs.
D)shows the costs to transfer out.
E)None of the answer choices is correct.
Question
Exhibit 4-1
Silva Coporation uses the weighted average process costing method.The Mixing Department at Silva had 17,000 units in beginning inventory.These units contained $70,000 in direct materials,$80,000 in direct labor,and $60,000 in overhead.During the period,the department incurred costs of $320,000 in direct materials,$400,000 in direct labor and $200,000 in overhead and started 80,000 units.Ending inventory consisted of 6,000 units which were 100% complete with respect to direct materials and 50% complete with respect to direct labor and overhead.
Refer to Exhibit 4-1.What is the cost per equivalent unit for overhead (rounded to the nearest cent)?

A)$2.77
B)$0.64
C)$2.52
D)$2.68
E)None of the answer choices is correct.
Question
When preparing a production cost report using the weighted average process costing method,"units to be accounted for" include:

A)units in beginning WIP Inventory plus units started during the period.
B)units transferred out plus units in beginning WIP Inventory.
C)units started during the period plus units transferred out.
D)units in beginning WIP Inventory plus units in ending WIP Inventory.
E)None of the answer choices is correct.
Question
Exhibit 4-2
Chem Company makes chemicals and uses the weighted average process costing method.The company has two processing departments - Mixing and Packaging.They had no beginning inventories for April and the percentages of completion were 50% for direct materials,direct labor,and overhead.
 Mixing  Packaging  Gallons of chemical completed during April 90,00090,000 Gallons of chemical on hand at April 30 (50% complete) 8,0000 Production costs incurred $47,000$153,000\begin{array}{lrc} & \underline{\text { Mixing } }& \underline{\text { Packaging }} \\ \text { Gallons of chemical completed during April }& 90,000 & 90,000 \\\text { Gallons of chemical on hand at April 30 (50\% complete) } & 8,000 & 0 \\\text { Production costs incurred } & \$ 47,000 & \$ 153,000\end{array}


-Refer to Exhibit 4-2.What is the amount of ending WIP Inventory in the Mixing Department?

A)$6,000
B)$4,000
C)$2,000
D)$3,300
E)None of the answer choices is correct.
Question
Use the following information to calculate the cost per equivalent unit for direct materials,direct labor,overhead,and in total for the Assembly Department of Dessert Company for the month of June.
 Direct  Direct  Materials  Labor  Overhead  Total costs to be accounted for $600,000$1,200,000$1,800,000 Total equivalent units accounted for 30,000 units 24,000 units 24,000 units \begin{array}{lccc}& \text { Direct } & \text { Direct } & \\& \text { Materials } & \text { Labor } & \text { Overhead } \\\text { Total costs to be accounted for } & \$ 600,000 & \$ 1,200,000 & \$ 1,800,000 \\\text { Total equivalent units accounted for } & 30,000 \text { units } & 24,000 \text { units } & 24,000 \text { units }\end{array}
Question
Jasper Company uses the weighted average process costing method.The Mixing Department at Jasper had 17,000 units in beginning inventory.These units contained $88,000 in direct materials,$80,000 in direct labor,and $60,000 in overhead.During the period,the department incurred costs of $300,000 in direct materials,$400,000 in direct labor and $200,000 in overhead and started 80,000 units.Ending inventory consisted of 6,000 units which were 100% complete with respect to direct materials and 50% complete with respect to direct labor and overhead.What is the cost per equivalent unit for materials (rounded to the nearest cent)?

A)$4.12
B)$4.26
C)$3.76
D)$4.00
E)None of the answer choices is correct.
Question
Using the weighted average process costing method,which of the following are included in the calculation of "units accounted for" on the departmental production cost report?

A)Units in beginning WIP Inventory plus units started.
B)Units started plus units in ending WIP Inventory.
C)Units completed and transferred out plus units in ending WIP Inventory.
D)Units in beginning WIP Inventory plus units in ending WIP Inventory.
E)None of the answer choices is correct.
Question
Exhibit 4-2
Chem Company makes chemicals and uses the weighted average process costing method.The company has two processing departments - Mixing and Packaging.They had no beginning inventories for April and the percentages of completion were 50% for direct materials,direct labor,and overhead.
 Mixing  Packaging  Gallons of chemical completed during April 90,00090,000 Gallons of chemical on hand at April 30 (50% complete) 8,0000 Production costs incurred $47,000$153,000\begin{array}{lrc} & \underline{\text { Mixing } }& \underline{\text { Packaging }} \\ \text { Gallons of chemical completed during April }& 90,000 & 90,000 \\\text { Gallons of chemical on hand at April 30 (50\% complete) } & 8,000 & 0 \\\text { Production costs incurred } & \$ 47,000 & \$ 153,000\end{array}


-Refer to Exhibit 4-2.What is the cost per gallon for the mixing process?

A)$5.88
B)$0.50
C)$0.48
D)$0.54
E)None of the answer choices is correct.
Question
Alloy Manufacturing produces aluminum products in three processing departments -- Molding,Cutting,and Packaging.Transactions for the month of March are shown below:
Alloy Manufacturing produces aluminum products in three processing departments -- Molding,Cutting,and Packaging.Transactions for the month of March are shown below:   Prepare journal entries to record transactions (1)through (7).<div style=padding-top: 35px>
Prepare journal entries to record transactions (1)through (7).
Question
Holder Incorporated uses the weighted average method for its process costing system.The Assembly Department at began March with 24,000 units in Work in Process (WIP)Inventory,all of which were completed and transferred out during March.An additional 32,000 units were started during the month,12,000 of which were completed and transferred out during March.A total of 20,000 units remained in Work in Process Inventory at the end of March,and were at varying levels of completion as follows:
Direct materials: 80 percent complete
Direct labor: 60 percent complete
Overhead: 70 percent complete
A. Determine the units to be accounted for and units accounted for.

B. Calculate the equivalent units for direct materials, direct labor, and overhead.
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Deck 4: How Is Process Costing Used to Track Production Costs
1
Two important double-checks included in a production cost report are: (1)units to be accounted for matches units accounted for and (2)total costs to be accounted for matches total costs accounted for.
True
2
If 10 physical units of product are 30 percent complete at the end of the period,an equivalent of 3 completed units will be used for process costing calculations.
True
3
When using process costing,only one companywide Work-in-Process account is allowed for tracking product costs.
False
4
A job costing system would be appropriate for an oil refinery.
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5
Most companies use either the weighted average or specific identification method to assign costs to inventory in a process costing environment.
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6
For a manufacturing company using process costing,cost per equivalent unit is only calculated for direct labor and direct materials.
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7
A company that uses process costing may use several Work-in-Process Inventory accounts.
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8
In a process costing system,partially completed units in Work-in-Process Inventory are typically converted to equivalent completed units.
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9
When units are transferred from one production process to another,the journal entry will include a debit and a credit to two different Work-in-Process Inventory accounts.
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10
A process costing system is used by companies that produce similar or identical units of product.
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11
Process costing is typically used by service companies that have one department.
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12
A company producing the following product will likely not use process costing?

A)Milk
B)Custom built yachts
C)Oil
D)soda
E)None of the answer choices is correct.
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13
Both process costing and job costing typically include three product costs direct materials,direct labor,and manufacturing overhead.
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14
In a process costing system,the first step is to summarize the physical flow of units so that Units to be accounted for equals Units sold.
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15
A bike repair shop would most likely use a process costing system.
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16
Because direct materials,direct labor,and overhead may enter a process at varying stages,equivalent units in Work-in-Process Inventory may be different for each of these components of production.
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17
When using a process costing system,product costs are tracked by department rather than by job.
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18
The unit cost information for process costing comes from the departmental production cost report.
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19
In a process costing system,the department where production begins will never have transferred-in costs from another department.
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20
The production cost report is often prepared using computerized software to minimize math errors and to speed up the process.
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21
Diaz Company uses process costing in its two processing departments Assembly and Finishing.If the direct labor costs incurred for the Assembly Department totaling $15,000 are to be paid next month,which one of the following journal entries would be made to record this transaction?
a.
 Wages Payable 15,000 Wages Expense 15,000\begin{array}{llr} \text { Wages Payable } &15,000\\ \text { Wages Expense } &&15,000\\\end{array}

b.
WIP Inventory - Assembly 15,000Wages Payable 15,000\begin{array}{llr} \text {WIP Inventory - Assembly } &15,000\\ \text {Wages Payable } &&15,000\\\end{array}

c.
Wages Payable 15,000 WIP Inventory - Assembly15,000\begin{array}{llr} \text {Wages Payable } &15,000\\ \text { WIP Inventory - Assembly} &&15,000\\\end{array}

d.
Wages Expense 15,000 WIP Inventory - Assembly 15,000\begin{array}{llr} \text {Wages Expense } &15,000\\ \text { WIP Inventory - Assembly } &&15,000\\\end{array}

e.  None of the answer choices is correct.\text { None of the answer choices is correct.}
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22
If a processing department has no beginning WIP Inventory,and the ending WIP Inventory is 100% complete as to material costs,the number of equivalent units for material costs is:

A)always equal to zero.
B)equal to the units completed.
C)less than the units placed into the process.
D)equal to the units placed into the process.
E)None of the answer choices is correct.
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23
Equivalent units are usually applied to:

A)only direct materials and direct labor.
B)only direct materials and overhead.
C)only direct labor.
D)direct materials,direct labor,and overhead.
E)None of the answer choices is correct.
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24
Using a process costing system,the journal entry to record the requisition of direct materials to be used in production includes:

A)a debit to Raw Materials Inventory
B)a debit to Manufacturing Overhead
C)a credit to Raw Material Inventory
D)a credit to Work in Process Inventory
E)None of the answer choices is correct.
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25
Using a process costing system,the journal entry to record the cost of completed goods when sold includes:

A)a debit to Finished Goods Inventory.
B)a credit to Cost of Goods Sold.
C)a debit to Work in Process Inventory.
D)a credit to Finished Goods Inventory.
E)None of the answer choices is correct.
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26
Diaz Company uses process costing in its two processing departments Assembly and Finishing.If the Finishing Department is the final production department and completes product with a production cost of $15,000,which one of the following journal entries would be made to record this transaction?
a.
 Cost of Goods Sold 15,000 WIP Inventory - Finishing 15,000\begin{array}{llr} \text { Cost of Goods Sold } &15,000\\ \text { WIP Inventory - Finishing } &&15,000\\\end{array}

b.
 Finished Goods Inventory 15,000 Cost of Goods Sold 15,000\begin{array}{llr} \text { Finished Goods Inventory } &15,000\\ \text { Cost of Goods Sold } &&15,000\\\end{array}

c.
WIP Inventory - Finishing 15,000Finished Goods Inventory 15,000\begin{array}{llr} \text {WIP Inventory - Finishing } &15,000\\ \text {Finished Goods Inventory } &&15,000\\\end{array}

d.
Finished Goods Inventory 15,000WIP Inventory - Finishing 15,000\begin{array}{llr} \text {Finished Goods Inventory } &15,000\\ \text {WIP Inventory - Finishing } &&15,000\\\end{array}

e. None of the answer choices is correct.\text {None of the answer choices is correct.}
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27
Diaz Company uses process costing in its two processing departments; Assembly and Finishing.If the Assembly Department requisitioned direct materials to be used in production,totaling $80,000,which one of the following journal entries would be made to record this transaction?
a.
 WIP Inventory - Assembly 80,000 WIP Inventory - Materials 80,000\begin{array}{ll}\text { WIP Inventory - Assembly } &80,000\\\text { WIP Inventory - Materials }&&80,000\end{array}

b.
 Raw Materials Inventory 80,000 WIP Inventory - Assembly 80,000\begin{array}{ll}\text { Raw Materials Inventory } &80,000\\\text { WIP Inventory - Assembly }&&80,000\end{array}

c.
 WIP Inventory - Assembly 80,000 Raw Materials Inventory 80,000\begin{array}{ll}\text { WIP Inventory - Assembly }&80,000 \\\text { Raw Materials Inventory }&&80,000\end{array}

d.
 Cost of Goods sold 80,000 Finished Goods Inventory 80,000\begin{array}{ll} \text { Cost of Goods sold } & 80,000 \\\text { Finished Goods Inventory }&&80,000 \end{array}

e.  None of the answer choices is correct. \text { None of the answer choices is correct. }
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28
If ending inventory in the Distilling Department consists of 6,000 units which are 100% complete with respect to direct materials and 40% complete with respect to direct labor and overhead,what are the number of equivalent units for direct materials,direct labor,and overhead?

A)Direct materials = 6,000 units;direct labor = 6,000 units;overhead = 6,000 units
B)Direct materials = 2,400 units;direct labor = 2,400 units;overhead = 2,400 units
C)Direct materials = 6,000 units;direct labor = 2,400 units;overhead = 2,400 units
D)Direct materials = 6,000 units;direct labor = 2,400 units;overhead = 6,000 units
E)None of the answer choices is correct.
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29
Using a process costing system,the journal entry to record the use of direct labor in the Finishing Department includes:

A)a credit to Wages Payable.
B)a debit to Wages Expense.
C)a credit to Work in Process Inventory - Finishing.
D)a credit to Finished Goods Inventory.
E)None of the answer choices is correct.
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30
The following information is available for the current year for Pike company.
 Number of units in beginning WIP Inventory 12,000 (30% complete)  Number of units started in the current period 160,000 Number of units in the ending WIP Inventory 18,000 (70% complete) \begin{array}{ll}\text { Number of units in beginning WIP Inventory } & 12,000 \quad \text { (30\% complete) } \\\text { Number of units started in the current period } & 160,000 \\\text { Number of units in the ending WIP Inventory } & 18,000 \quad \text { (70\% complete) }\end{array}
If Pike Company uses the weighted average process costing method,what is the total equivalent completed units transferred out and in WIP Inventory?

A)166,000
B)190,000
C)166,600
D)142,000
E)None of the answer choices is correct.
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31
The Molding Department at Miley Corporation had 10,000 units in process on July 1 and 6,000 units in process on July 31.During July,it started 46,000 units.The cost per equivalent unit produced in July was $2.50.If the equivalent units produced in July were 48,000,what were the costs incurred during the month?

A)$105,000
B)$115,000
C)$120,000
D)$150,000
E)None of the answer choices is correct.
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32
Frost Company produces cupcakes in large batches.Three departments are involved in the production process -- Mixing,Baking,and Packaging.Frost uses a process costing system.If products with a cost of $10,000 are transferred from the Mixing Department to the Baking Department for further processing,which of the following journal entries is needed to record this transaction?
a.
 Finished Inventory - Mixing 10,000 Finished Inventory - Baking 10,000\begin{array}{l}\text { Finished Inventory - Mixing } &10,000 \\\text { Finished Inventory - Baking } &&10,000\\\end{array}

b.
 WIP Inventory - Baking 10,000 WIP Inventory - Mixing 10,000\begin{array}{l}\text { WIP Inventory - Baking } &10,000\\\text { WIP Inventory - Mixing } &&10,000\\\end{array}

c.
 WIP Inventory - Mixing 10,000 WIP Inventory - Baking 10,000\begin{array}{l}\text { WIP Inventory - Mixing } &10,000\\\text { WIP Inventory - Baking }&&10,000 \\\end{array}

d.
 Finished Inventory - Baking 10,000 Finished Inventory - Mixing 10,000\begin{array}{l}\text { Finished Inventory - Baking } &10,000 \\\text { Finished Inventory - Mixing }&&10,000\end{array}

e. None of the answer choices is correct.\text {None of the answer choices is correct.}
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33
The journal entry to record the transfer of units from one processing department to another processing department includes:

A)a debit to WIP Inventory.
B)a debit to Finished Goods Inventory.
C)a credit to WIP Inventory.
D)Both a and c are correct.
E)None of the answer choices is correct.
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34
The Packaging Department at Vail Incorporated had 51,000 units in beginning inventory.These units contained $105,000 in direct materials,$120,000 in direct labor,and $90,000 in overhead.During the period,the department incurred costs of $480,000 in direct materials,$600,000 in direct labor and $300,000 in overhead and started 240,000 units.Ending inventory consisted of 18,000 units which were 100% complete with respect to direct materials and 70% complete with respect to direct labor and overhead.How many units were transferred out?

A)309,000
B)291,000
C)282,000
D)273,000
E)None of the answer choices is correct.
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35
Frost Company produces cupcakes in large batches.Three departments are involved in the production process -- Mixing,Baking,and Packaging.Frost uses a process costing system.Assume products with a cost of $9,000 are sold to customers.Which of the following journal entries is needed to record this transaction?
a.
Cost of Goods Sold 9,000 Finished Goods Inventory 9,000\begin{array}{llr} \text {Cost of Goods Sold } &9,000\\ \text { Finished Goods Inventory } &&9,000\\\end{array}

b.
 WIP Inventory - Packaging 9,000 Finished Goods Inventory 9,000\begin{array}{llr} \text { WIP Inventory - Packaging } &9,000\\ \text { Finished Goods Inventory } &&9,000\\\end{array}

c.
 Finished Goods Inventory 9,000 Sales Revenue9,000\begin{array}{llr} \text { Finished Goods Inventory } &9,000\\ \text { Sales Revenue} &&9,000\\\end{array}

d.
 Finished Goods Inventory 9,000Cost of Goods Sold 9,000\begin{array}{llr} \text { Finished Goods Inventory } &9,000\\ \text {Cost of Goods Sold } &&9,000\\\end{array}

e. None of the answer choices is correct.\text {None of the answer choices is correct.}
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36
The number of equivalent units for any input (direct materials,direct labor,or overhead)cannot be greater than:

A)units completed.
B)units to account for.
C)units started.
D)total costs to account for.
E)None of the answer choices is correct.
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37
Diaz Company uses process costing in its two processing departments Assembly and Finishing.If the Assembly Department completes a batch of products with production costs of $30,000 and moves it to the Finishing Department,which one of the following journal entries would be made to record this transaction?
a.
 WIP Inventory - Finishing 30,000 WIP Inventory - Assembly 30,000\begin{array}{ll}\text { WIP Inventory - Finishing } & 30,000 \\\text { WIP Inventory - Assembly } && 30,000 \\\end{array}

b.
 WIP Inventory - Assembly 30,000 WIP Inventory - Finishing 30,000\begin{array}{ll}\text { WIP Inventory - Assembly } & 30,000 \\\text { WIP Inventory - Finishing } && 30,000 \\\end{array}

c.
 Finished Goods Inventory 30,000 WIP Inventory - Assembly 30,000\begin{array}{ll}\text { Finished Goods Inventory } & 30,000 \\\text { WIP Inventory - Assembly } && 30,000 \\\end{array}

d.
 WIP Inventory - Assembly 30,000 Cost of Goods Sold 30,000\begin{array}{ll}\text { WIP Inventory - Assembly } & 30,000 \\\text { Cost of Goods Sold } && 30,000\end{array}

e. None of the answer choices is correct.\text {None of the answer choices is correct.}
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38
Which of the following statements is true regarding cost per equivalent unit?

A)This calculation only includes variable costs.
B)This measure is used to assign costs to units transferred out.
C)This measure always stays the same from one month to the next regardless of different levels of production.
D)The formula to calculate this measure uses total equivalent units accounted for divided by total costs to be accounted for.
E)None of the answer choices is correct.
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39
Diaz Company uses process costing in its two processing departments Assembly and Finishing.If completed goods with a cost of $62,000 are sold,which one of the following journal entries would be made to record this transaction?
a.
Cost of Goods Sold 62,000 Finished Goods Inventory 62,000\begin{array}{llr} \text {Cost of Goods Sold } &62,000\\ \text { Finished Goods Inventory } &&62,000\\\end{array}

b.
Cost of Goods Sold 62,000 Sales Revenue 62,000\begin{array}{llr} \text {Cost of Goods Sold } &62,000\\ \text { Sales Revenue } &&62,000\\\end{array}

c.
WIP Inventory - Assembly 62,000 WIP Inventory - Finishing 62,000\begin{array}{llr} \text {WIP Inventory - Assembly } &62,000\\ \text { WIP Inventory - Finishing } &&62,000\\\end{array}

d.
Finished Goods Inventory 62,000 Cost of Goods Sold 62,000\begin{array}{llr} \text {Finished Goods Inventory } &62,000\\ \text { Cost of Goods Sold } &&62,000\\\end{array}

e. None of the answer choices is correct.\text {None of the answer choices is correct.}
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40
Frost Company produces cupcakes in large batches.Three departments are involved in the production process -- Mixing,Baking,and Packaging.Frost uses a process costing system.If the Mixing Department requisitioned direct materials to be used in production totaling $3,500,which of the following journal entries is needed to record this transaction?
a.
 Raw Materials Inventory 3,500 WIP Inventory - Mixing3,500\begin{array}{llr} \text { Raw Materials Inventory } &3,500\\ \text { WIP Inventory - Mixing} &&3,500\\\end{array}

b.
Finished Goods Inventory 3,500 Raw Materials Inventory 3,500\begin{array}{llr} \text {Finished Goods Inventory } &3,500\\ \text { Raw Materials Inventory } &&3,500\\\end{array}

c.
 WIP Inventory - Mixing 3,500 Mixing Manufacturing Overhead 3,500\begin{array}{llr} \text { WIP Inventory - Mixing } &3,500\\ \text { Mixing Manufacturing Overhead } &&3,500\\\end{array}

d.
 WIP Inventory - Mixing 3,500Raw Materials Inventory 3,500\begin{array}{llr} \text { WIP Inventory - Mixing } &3,500\\ \text {Raw Materials Inventory } &&3,500\\\end{array}

e.  None of the answer choices is correct.\text { None of the answer choices is correct.}
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41
Mathews Company uses the weighted average process costing method.The company had no units in beginning WIP Inventory.Mathews has calculated that 45,000 total equivalent units were completed during the year.If 53,000 units were started in the current period and 10,000 units were in ending WIP Inventory,what percentage of completion existed in the ending inventory units?

A)20%
B)22%
C)56%
D)81%
E)None of the answer choices is correct.
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42
Everlast Inc.had 12,000 units in WIP Inventory at December 1 that were 70% complete with respect to direct labor and overhead.During December,40,000 units were completed.On December 31,the 14,000 units in WIP Inventory were 30% complete as to direct labor and overhead.Direct materials are added at the beginning of the process.How many units were started during December?

A)42,000
B)66,000
C)38,000
D)32,000
E)None of the answer choices is correct.
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43
Calculate the number of equivalent units for each of the following independent cases.
(1) A trade school has 1,000 students enrolled in classes during the current term. The dean is interested in knowing the number of full-time equivalent students enrolled. The average student takes 40% 40 \% of a full load of classes. What is the number of full-time equivalent students?

(2) A total of 8,500 units of product remain in the Finishing Department at the end of the year. Direct materials are 60 percent complete and direct labor is 50 percent complete. What amount of equivalent units remain in the Finishing Department for direct materials and direct labor at year end?

(3) The natal care unit of a Hope Hospital has 50 nurses working on a part-time basis, with the average nurse working 70% 70 \% of a full load. What is the number of full-time equivalent nurses employed by the hospital?

(4) A total of 3,000 units of product remain in the Fabricating Department at the end of the year. These products are 45% 45 \% complete with respect to direct materials and 20% 20 \% complete in terms of direct labor. What is the equivalent units remaining in the Fabrication Department for direct materials and direct labor at year end?.
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44
Exhibit 4-1
Silva Coporation uses the weighted average process costing method.The Mixing Department at Silva had 17,000 units in beginning inventory.These units contained $70,000 in direct materials,$80,000 in direct labor,and $60,000 in overhead.During the period,the department incurred costs of $320,000 in direct materials,$400,000 in direct labor and $200,000 in overhead and started 80,000 units.Ending inventory consisted of 6,000 units which were 100% complete with respect to direct materials and 50% complete with respect to direct labor and overhead.
Refer to Exhibit 4-1.What is the cost per equivalent unit for direct labor (rounded to the nearest cent)?

A)$5.28
B)$5.11
C)$4.94
D)$0.86
E)None of the answer choices is correct.
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45
Match between columns
Premises:
A company that builds bridges
A company that builds bridges
Motor oil manufacturer
Motor oil manufacturer
Responses:
job costing
process costing
job costing
process costing
job costing
process costing
job costing
process costing
job costing
process costing
job costing
process costing
job costing
process costing
job costing
process costing
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46
Exhibit 4-1
Silva Coporation uses the weighted average process costing method.The Mixing Department at Silva had 17,000 units in beginning inventory.These units contained $70,000 in direct materials,$80,000 in direct labor,and $60,000 in overhead.During the period,the department incurred costs of $320,000 in direct materials,$400,000 in direct labor and $200,000 in overhead and started 80,000 units.Ending inventory consisted of 6,000 units which were 100% complete with respect to direct materials and 50% complete with respect to direct labor and overhead.
Refer to Exhibit 4-1.What is the total cost of units transferred out?

A)$1,221,580
B)$1,150,420
C)$1,079,260
D)$1,082,900
E)None of the answer choices is correct.
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47
The ending WIP Inventory in the Assembly Department contains 800 units that are 100% complete with respect to direct materials and 80% complete with respect to direct labor and overhead.The cost per equivalent unit for inventory is $3.00,which consists of $2.00 for materials,$0.80 for labor,and $0.20 for overhead.What dollar value is assigned to the ending WIP Inventory?

A)$1,600
B)$512
C)$128
D)$2,240
E)None of the answer choices is correct.
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48
Exhibit 4-2
Chem Company makes chemicals and uses the weighted average process costing method.The company has two processing departments - Mixing and Packaging.They had no beginning inventories for April and the percentages of completion were 50% for direct materials,direct labor,and overhead.
 Mixing  Packaging  Gallons of chemical completed during April 90,00090,000 Gallons of chemical on hand at April 30 (50% complete) 8,0000 Production costs incurred $47,000$153,000\begin{array}{lrc} & \underline{\text { Mixing } }& \underline{\text { Packaging }} \\ \text { Gallons of chemical completed during April }& 90,000 & 90,000 \\\text { Gallons of chemical on hand at April 30 (50\% complete) } & 8,000 & 0 \\\text { Production costs incurred } & \$ 47,000 & \$ 153,000\end{array}


-Refer to Exhibit 4-2.What is the cost per gallon for the packaging process?

A)$1.66
B)$1.78
C)$1.70
D)$1.56
E)None of the answer choices is correct.
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49
The cost per equivalent unit in the production cost report equals the "costs to be accounted for" divided by the number of:

A)units sold.
B)equivalent units produced.
C)units completed.
D)units started.
E)None of the answer choices is correct.
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50
The production cost report does all the following except:

A)calculates production for the next period.
B)shows the equivalent units of production.
C)helps in controlling costs.
D)shows the costs to transfer out.
E)None of the answer choices is correct.
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51
Exhibit 4-1
Silva Coporation uses the weighted average process costing method.The Mixing Department at Silva had 17,000 units in beginning inventory.These units contained $70,000 in direct materials,$80,000 in direct labor,and $60,000 in overhead.During the period,the department incurred costs of $320,000 in direct materials,$400,000 in direct labor and $200,000 in overhead and started 80,000 units.Ending inventory consisted of 6,000 units which were 100% complete with respect to direct materials and 50% complete with respect to direct labor and overhead.
Refer to Exhibit 4-1.What is the cost per equivalent unit for overhead (rounded to the nearest cent)?

A)$2.77
B)$0.64
C)$2.52
D)$2.68
E)None of the answer choices is correct.
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52
When preparing a production cost report using the weighted average process costing method,"units to be accounted for" include:

A)units in beginning WIP Inventory plus units started during the period.
B)units transferred out plus units in beginning WIP Inventory.
C)units started during the period plus units transferred out.
D)units in beginning WIP Inventory plus units in ending WIP Inventory.
E)None of the answer choices is correct.
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53
Exhibit 4-2
Chem Company makes chemicals and uses the weighted average process costing method.The company has two processing departments - Mixing and Packaging.They had no beginning inventories for April and the percentages of completion were 50% for direct materials,direct labor,and overhead.
 Mixing  Packaging  Gallons of chemical completed during April 90,00090,000 Gallons of chemical on hand at April 30 (50% complete) 8,0000 Production costs incurred $47,000$153,000\begin{array}{lrc} & \underline{\text { Mixing } }& \underline{\text { Packaging }} \\ \text { Gallons of chemical completed during April }& 90,000 & 90,000 \\\text { Gallons of chemical on hand at April 30 (50\% complete) } & 8,000 & 0 \\\text { Production costs incurred } & \$ 47,000 & \$ 153,000\end{array}


-Refer to Exhibit 4-2.What is the amount of ending WIP Inventory in the Mixing Department?

A)$6,000
B)$4,000
C)$2,000
D)$3,300
E)None of the answer choices is correct.
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54
Use the following information to calculate the cost per equivalent unit for direct materials,direct labor,overhead,and in total for the Assembly Department of Dessert Company for the month of June.
 Direct  Direct  Materials  Labor  Overhead  Total costs to be accounted for $600,000$1,200,000$1,800,000 Total equivalent units accounted for 30,000 units 24,000 units 24,000 units \begin{array}{lccc}& \text { Direct } & \text { Direct } & \\& \text { Materials } & \text { Labor } & \text { Overhead } \\\text { Total costs to be accounted for } & \$ 600,000 & \$ 1,200,000 & \$ 1,800,000 \\\text { Total equivalent units accounted for } & 30,000 \text { units } & 24,000 \text { units } & 24,000 \text { units }\end{array}
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55
Jasper Company uses the weighted average process costing method.The Mixing Department at Jasper had 17,000 units in beginning inventory.These units contained $88,000 in direct materials,$80,000 in direct labor,and $60,000 in overhead.During the period,the department incurred costs of $300,000 in direct materials,$400,000 in direct labor and $200,000 in overhead and started 80,000 units.Ending inventory consisted of 6,000 units which were 100% complete with respect to direct materials and 50% complete with respect to direct labor and overhead.What is the cost per equivalent unit for materials (rounded to the nearest cent)?

A)$4.12
B)$4.26
C)$3.76
D)$4.00
E)None of the answer choices is correct.
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56
Using the weighted average process costing method,which of the following are included in the calculation of "units accounted for" on the departmental production cost report?

A)Units in beginning WIP Inventory plus units started.
B)Units started plus units in ending WIP Inventory.
C)Units completed and transferred out plus units in ending WIP Inventory.
D)Units in beginning WIP Inventory plus units in ending WIP Inventory.
E)None of the answer choices is correct.
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57
Exhibit 4-2
Chem Company makes chemicals and uses the weighted average process costing method.The company has two processing departments - Mixing and Packaging.They had no beginning inventories for April and the percentages of completion were 50% for direct materials,direct labor,and overhead.
 Mixing  Packaging  Gallons of chemical completed during April 90,00090,000 Gallons of chemical on hand at April 30 (50% complete) 8,0000 Production costs incurred $47,000$153,000\begin{array}{lrc} & \underline{\text { Mixing } }& \underline{\text { Packaging }} \\ \text { Gallons of chemical completed during April }& 90,000 & 90,000 \\\text { Gallons of chemical on hand at April 30 (50\% complete) } & 8,000 & 0 \\\text { Production costs incurred } & \$ 47,000 & \$ 153,000\end{array}


-Refer to Exhibit 4-2.What is the cost per gallon for the mixing process?

A)$5.88
B)$0.50
C)$0.48
D)$0.54
E)None of the answer choices is correct.
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58
Alloy Manufacturing produces aluminum products in three processing departments -- Molding,Cutting,and Packaging.Transactions for the month of March are shown below:
Alloy Manufacturing produces aluminum products in three processing departments -- Molding,Cutting,and Packaging.Transactions for the month of March are shown below:   Prepare journal entries to record transactions (1)through (7).
Prepare journal entries to record transactions (1)through (7).
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59
Holder Incorporated uses the weighted average method for its process costing system.The Assembly Department at began March with 24,000 units in Work in Process (WIP)Inventory,all of which were completed and transferred out during March.An additional 32,000 units were started during the month,12,000 of which were completed and transferred out during March.A total of 20,000 units remained in Work in Process Inventory at the end of March,and were at varying levels of completion as follows:
Direct materials: 80 percent complete
Direct labor: 60 percent complete
Overhead: 70 percent complete
A. Determine the units to be accounted for and units accounted for.

B. Calculate the equivalent units for direct materials, direct labor, and overhead.
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