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Exam 3: Process Costing

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Question 21

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Under process costing when the product is through the last production process,the journal entry for total manufacturing cost includes a debit to Work in Process Inventory and a credit to Finished Goods Inventory.Under process costing when the product is through the last production process,the journal entry for total manufacturing cost includes a debit to Finished Goods Inventory and a credit to Work in Process Inventory.

A) True
B) False

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Question 22

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Under the weighted average method of process costing,the cost per equivalent unit is calculated for which of the following pairs of categories?

A) Units sold and units in ending Finished Goods Inventory.
B) Direct materials and conversion costs.
C) Manufacturing costs and nonmanufacturing costs.
D) Completed units and ending units in process.

E) B) and D)
F) All of the above

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Question 23

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How could a firm using the weighted average method of process costing calculate how many units were worked on during a period?

The total cost of Work in Process incurred in one department during the period must be split between costs transferred to the next department and costs transferred to Finished Goods.The total cost of Work in Process incurred during the period must be split between costs transferred to the next department and costs remaining in the current department as Work in Process Inventory.

How could a firm using the weighted average method of process costing calculate how many units were started during a period?

Which of the following companies would most likely use process costing?

Kenney Co.uses process costing to account for the production of canned energy drinks.Direct materials are added at the beginning of the process and conversion costs are incurred uniformly throughout the process.Equivalent units have been calculated to be 19,200 units for materials and 16,000 units for conversion costs.Beginning inventory consisted of $11,200 in materials and $6,400 in conversion costs.April costs were $57,600 for materials and $64,000 for conversion costs.Ending inventory still in process was 6,400 units (100% complete for materials,50% for conversion) .The cost per equivalent unit for materials using the weighted average method would be closest to:

Process costing does not use a Work in Process Inventory account.In process costing,there will be a separate Work in Process Inventory account for each of the major processes.

The process costing production report can be prepared using either the weighted-average method or the last-in,first-out (LIFO)method.The process costing production report can be prepared using either the weighted-average method or the first-in,first-out (FIFO)method.

The journal entry to record the sale of goods includes

A separate Work in Process Inventory account is used in process costing for each major production process.In process costing,there will be a separate Work in Process Inventory account for each of the major processes.

Nettle Co.uses process costing to account for the production of rubber balls.Direct materials are added at the beginning of the process and conversion costs are incurred uniformly throughout the process.Equivalent units have been calculated to be 12,000 units for materials and 10,000 units for conversion costs.Beginning inventory consisted of $14,000 in materials and $8,000 in conversion costs.April costs were $72,000 for materials and $80,000 for conversion costs.Ending inventory still in process was 4,000 units (100% complete for materials,50% for conversion) .The cost per unit for materials using the FIFO method would be closest to

Tripper Corp uses a FIFO process costing system.Beginning inventory for January consisted of 1,000 units that were 60% completed.10,000 units were started into the process during January.During January,9,500 units were started and completed.How many units were in ending inventory on January 31?

To reconcile the number of physical units using the weighted average method of process costing,one must determine whether the units were

Which of the following is a characteristic of process costing?

Equivalent units for materials may differ from the equivalent units for conversion costs.Equivalent units may differ for the two categories since their percentage of completion may differ.

Harlow Corp uses a FIFO process costing system.Beginning inventory for January consisted of 1,000 units that were 60% completed.During January,9,500 units were started and completed.On January 31,the inventory consisted of 500 units that were 70% completed.How many units were started during January?

Under the FIFO method,physical units must be broken down into

Frost,Inc.is a service firm that uses process costing.The firm worked on a total of 1,600 cases this month,800 of which were completed during the period.The remaining cases were 40% complete.The firm incurred $180,000 in direct labor and manufacturing overhead costs during the period,and had $4,800 in direct labor and manufacturing costs in beginning inventory.Using the weighted average method,what was total cost per equivalent unit?

Bildy Corp uses a process costing system.During January,13,000 units were started into the process,and 13,650 units were completed.On January 31,the inventory consisted of 650 units that were 70% completed.How many units were in beginning inventory on January 1?