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Exam 20: Process Cost Systems

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Question 81

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Department A had 4,000 units in work in process that were 60% completed as to labor and overhead at the beginning of the period, 29,000 units of direct materials were added during the period, 31,000 units were completed during the period, and 2,000 units were 80% completed as to labor and overhead at the end of the period. All materials are added at the beginning of the process. The first-in, first-out method is used to cost inventories. The number of equivalent units of production for conversion costs for the period was:

A) 30,200
B) 29,800
C) 33,800
D) 33,000

E) All of the above
F) None of the above

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Question 82

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Department G had 3,600 units, 25% completed at the beginning of the period, 11,000 units were completed during the period, 3,000 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 total cost of the units "started and completed" during the period (round unit cost calculations to four decimal places) ?

A) $211,200
B) $120,060
C) $190,275
D) $20,934

E) A) and B)
F) A) and C)

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Question 83

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The cost of production report summarizes (1) the units for which the department is accountable and the units to be assigned costs and (2) the costs charged to the department and the allocation of those costs.

The last step in the accounting procedure for process costing is the calculation of equivalent units of production.

Direct materials, direct labor, and factory overhead are assigned to each manufacturing process in a process costing system.

The inventory at April 1, 2012, and the costs charged to Work in Process--Department B during April for Hawk Company are as follows: During April, all direct materials are transferred from Department A, the units in process at April 1 were completed, and of the 10,000 units entering the department, all were completed except 1,200 units which were 25% completed as to conversion costs. Inventories are costed by the first-in, first-out method. Prepare a cost of production report for April.

In a process cost system, product costs are accumulated by processing department rather than by job.

The following production data were taken from the records of the Finishing Department for June: Determine the number of equivalent units of production in the June 30 Finishing Department inventory, assuming that the first-in, first-out method is used to cost inventories. Assume the completion percentage of 25% applies to both direct materials and conversion costs.

Mocha Company manufactures a single product by a continuous process, involving three production departments. The records indicate that direct materials, direct labor, and applied factory overhead for Department 1 were $100,000, $125,000, and $150,000, respectively. The records further indicate that direct materials, direct labor, and applied factory overhead for Department 2 were $55,000, $65,000, and $80,000, respectively. In addition, work in process at the beginning of the period for Department 1 totaled $75,000, and work in process at the end of the period totaled $60,000. The journal entry to record the flow of costs into Department 2 during the period for applied overhead is:

Department S had no work in process at the beginning of the period. 12,000 units of direct materials were added during the period at a cost of $84,000, 9,000 units were completed during the period, and 3,000 units were 30% completed as to labor and overhead at the end of the period. All materials are added at the beginning of the process. Direct labor was $49,500 and factory overhead was $9,900. The total conversion costs for the period were:

If the principal products of a manufacturing process are identical, a process cost system is more appropriate than a job order cost system.

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 18,000 units completed during the period?

Process manufacturers typically use large machines to process a continuous flow of raw materials into a finished state.

Mocha Company manufactures a single product by a continuous process, involving three production departments. The records indicate that direct materials, direct labor, and applied factory overhead for Department 1 were $100,000, $125,000, and $150,000, respectively. Work in process at the beginning of the period for Department 1 was $75,000, and work in process at the end of the period totaled $60,000. The records indicate that direct materials, direct labor, and applied factory overhead for Department 2 were $50,000, $60,000, and $70,000, respectively. In addition, work in process at the beginning of the period for Department 2 totaled $75,000, and work in process at the end of the period totaled $60,000. The journal entry to record the flow of costs into Department 3 during the period is:

On March 1, Upton Company's packaging department had Work in Process inventory of 8,820 units, which had been transferred in from the finishing department. These units had accumulated costs of $315,000 in previous departments and $16,000 for conversion costs in the packaging department. During March, 30,000 units were transferred into the department. These units had accumulated costs of $770,000 in the previous departments. The packaging department incurred $54,000 in conversion costs during the month. Seven hundred units remained in ending inventory on March 31. These units were 80% complete with respect to conversion costs. Required: Calculate the cost per equivalent unit for transferred-in costs and for conversion costs for the packaging department using the average cost method.

The amount journalized showing the cost added to finished goods is taken from the cost of production report.

In a process costing system, the cost per equivalent unit is computed before computing equivalent units.

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 materials cost per equivalent unit (to the nearest cent) for April is:

Department A had 4,000 units in work in process that were 60% completed as to labor and overhead at the beginning of the period, 29,000 units of direct materials were added during the period, 31,000 units were completed during the period, and 2,000 units were 80% completed as to labor and overhead at the end of the period. All materials are added at the beginning of the process. The first-in, first-out method is used to cost inventories. The number of equivalent units of production for material costs for the period was:

Using the FIFO method, the cost of goods completed and transferred out during July was (use average cost per unit rounded to four decimal places in computations)