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Exam 18: Process Cost Systems

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Question 71

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Conversion and direct materials are generally both added at the end of the production process.

A) True
B) False

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Question 72

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The cost per equivalent units of direct materials and conversion in the Bottling Department of Beverages on Jolt Company is $0.47 and $0.15, respectively. The equivalent units to be assigned costs are as follows. The beginning work in process inventory had a cost of $3,500. Determine the cost of completed and transferred out production, and the ending work in process inventory.

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Question 73

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Which of the following measures would not help managers to control and improve operations?

If a company uses a process costing system to account for the costs in its five production departments, how many work in process accounts will it use?

Conversion costs are generally added evenly throughout the process.

Both process and job order cost systems maintain perpetual inventory accounts with subsidiary ledgers.

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

The entry to transfer goods in process from Department X to Department Y includes a debit to Work in Process-Department X.

In a process cost system, the amount of work in process inventory is valued by

What is the number of material equivalent units of production in the June 30, Finishing Department inventory, assuming that the first-in, first-out method is used to cost inventories and materials were added at the beginning of the process?

All direct materials are placed in process at the beginning of production and 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) ?

In the manufacture of 8,000 units of a product, direct materials cost incurred was $154,600, direct labor cost incurred was $84,000, and applied factory overhead was $45,500. What is the total conversion cost?

Penny, Inc. employs a process costing system. Direct materials are added at the beginning of the process. Here is information about July's activities: -Using the FIFO method, the cost per equivalent unit for materials used during July was

Information for the Nichols Manufacturing Company for the month of May is as follows: Prepare a cost of production report for the month of May, using the FIFO method.

The journal entry to record the flow of costs into Department 1 during the period for applied overhead is

Kamin Company's Mixing Department had a beginning inventory of 4,000 units which had accumulated conversion costs of $55,000. During the period, the Mixing Department accumulated conversion costs of $92,000 and started 8,000 new units. Ending inventory was 2,500 units which were 40% complete with respect to conversion costs. Kamin uses the average cost method to cost inventories. Calculate the cost per equivalent unit for conversion costs in the Mixing Department.

Carolwood Company manufactures widgets and uses process costing. The status of the beginning and ending inventory is: $\begin{array} { | l | l | } \hline \text { Beginning inventory } & 30 \% \text { of the manufacturing process is complete } \\\hline \text { Ending inventory } & 55 \% \text { of the manufacturing process is complete } \\\hline\end{array}$ Direct materials are added to the manufacturing process in stages. None are added when production begins. Approximately 1/2 of the materials are added when the product is 25% complete. The other half is added when the product is 50% complete. What percentage complete are beginning inventory and ending inventory with respect to direct materials DM) and conversion costs CC) ?

If a company uses average costing instead of FIFO, it will still get the same unit costs.

Department S had 500 units 60% completed in process at the beginning of the period; 9,000 units completed during the period; and 600 units 30% completed at the end of the period. What was the number of equivalent units of production for the period for conversion if the first-in, first-out method is used to cost inventories? Assume the completion percentage applies to both direct materials and conversion cost.

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