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Exam 20: Process Cost Systems

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Question 71

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Which of the following industries would normally use job order costing systems and which would normally use process costing systems? Business consulting Chemicals Food Movie Soap and cosmetics Web designing

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Question 72

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Kramer Company started its production operations on August 1. During August, the printing department completed 17,600 units. There were 4,400 units in ending inventory which were 80% complete with respect to materials and 10% complete with respect to conversion costs. During August, the department accumulated materials costs of $45,408 and conversion costs of $76,670. Required: a. Calculate the cost of the goods transferred out. b. What is the value of the ending inventory? Round intermediate computation to nearest cent. Cost per equivalent unit for materials = $45,408 / (17,600 + (.80)*(4,400)) = $2.15 Cost per equivalent unit for conversion costs = $76,670 / (17,600 + (.10)*(4,400))= $4.25

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a. ($2.15 + $4.25) *...

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Question 73

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The portion of whole units that were completed with respect to either materials or conversion costs within a given accounting period is the definition of

Which of the following costs incurred by a paper manufacturer would NOT be included in the group of costs referred to as conversion costs?

Equivalent units should be computed separately for direct materials and conversion costs.

If the costs for direct materials, direct labor, and factory overhead were $60,000, $35,000, and $25,000, respectively, for 20,000 equivalent units of production, the conversion cost per equivalent unit was $6.

If a company uses a process costing system to account for the costs in its four production departments, how many Work-in-Process will it use?

Department J had no work in process at the beginning of the period, 18,000 units were completed during the period, 2,000 units were 30% completed at the end of the period, and the following manufacturing costs were debited to the departmental work in process account during the period (Assuming the company uses FIFO and rounds average cost per unit to two decimal places) : Assuming that all direct materials are placed in process at the beginning of production, what is the total cost of the departmental work in process inventory at the end of the period?

The debits to Work in Process--Assembly Department for April, together with data concerning production, are as follows: All direct materials are placed in process at the beginning of the process and the first-in, first-out method is used to cost inventories. The conversion cost per equivalent unit for April is:

In a process costing system, costs flow into finished goods inventory only from the work in process inventory of the last manufacturing process.

Zither Co. manufactures a product called Zens in a three-process series. All materials are introduced at the beginning of the first process. Zither uses the first-in, first-out method of inventory costing. Unit and cost data for the first process (Department A) for the month of October 2012 follow: Prepare Zither's Department A cost of production report for October.

The two categories of cost comprising conversion costs are:

Department G had 3,600 units, 40% completed at the beginning of the period, 12,000 units were completed during the period, 2,000 units were one-fifth completed at the end of the period, and the following manufacturing costs were debited to the departmental work in process account during the period: Assuming that all direct materials are placed in process at the beginning of production and that the first-in, first-out method of inventory costing is used, what is the equivalent units for materials and conversion costs, respectively.

On August 1, Jones Corporation's packaging department had Work in Process inventory of 8,000 units that were 75% complete with respect to materials and 30% complete with respect to conversion costs. The cost of these units was $99,525 ($62,000 transferred-in from previous departments, $28,775 in materials, and $8,750 in labor and overhead). During August, 125,000 units were transferred into the department. These units had accumulated costs in previous departments of $1,418,560. The packaging department incurred costs of $799,225 for materials and $498,010 for conversion costs in August and transferred 131,000 units out of the department. The 2,000 units remaining in ending inventory are 50% complete with respect to materials and 20% complete with respect to conversion costs. Jones Corporation uses the average cost method to cost its inventories. Required a. Calculate the cost per equivalent unit for transferred-in costs, materials, and conversion costs. b. Calculate the cost of the units transferred out of the department. c. Calculate the cost of the ending inventory.

Describe the flow of materials in a process cost accounting system.

Carmelita Inc., has the following information available: At the beginning of the period, there were 500 units in process that were 60 percent complete as to conversion costs and 100 percent complete as to direct materials costs. During the period 4,500 units were started and completed. Ending inventory contained 340 units that were 30 percent complete as to conversion costs and 100 percent complete as to materials costs. (Assume that the company uses the FIFO process cost method.) The cost of completing a unit during the current period was

The debits to Work in Process--Assembly Department for April, together with data concerning production, are as follows: All direct materials are placed in process at the beginning of the process and the first-in, first-out method is used to cost inventories. The materials cost per equivalent unit for April is:

Which of the following is not a use of the cost of production report?

The debits to Work in Process--Assembly Department for April, together with data concerning production, are as follows: All direct materials are placed in process at the beginning of the process and the average cost method is used to cost inventories. The conversion cost per equivalent unit (to the nearest cent) for April is:

Equivalent units of production are always the same as the total number of physical units finished during the period.