Job Order and Process Costing Systems - Quiz

Topics: Costs, Supply chain management terms, Manufacturing Pages: 18 (1491 words) Published: September 22, 2013
 1.
Question :
(TCO F) Assume there is no beginning work in process inventory and the ending work in process inventory is 100% complete with respect to materials costs. The number of equivalent units with respect to materials costs under the weighted-average method is:

 
Student Answer:

XX the same as the number of units put into production.
 

less than the number of units put into production.
 

the same as the number of units completed.
 

less than the number of units completed.
 
Instructor Explanation:
Chapter 4

 
Points Received:
5 of 5
 
Comments:
Great job

 2.
Question :
(TCO F) Process costing would be appropriate for each of the following except:

 
Student Answer:

XX custom furniture manufacturing.
 

oil refining.
 

grain milling.
 

newsprint production.
 
Instructor Explanation:
Chapter 4

 
Points Received:
5 of 5
 
Comments:
Great job

 3.
Question :
(TCO F) Lucas Company uses the weighted-average method in its process costing system. The company adds materials at the beginning of the process in the Forming Department, which is the first of two stages in its production process. Information concerning operations in the Forming Department in October follows:  

 
Units
Material Cost
Work in process on October 1
6,000
$3,000
Units started in October
50,000
$25,560
Units completed and transferred to next Department during October 44,000
 

 
What was the materials cost of work in process at on October 31?

 
Student Answer:

$3,060
 

$5,520
 

$6,000
 

XX $6,120
 
Instructor Explanation:
To solve for units transferred:
 
+ Work in process, beginning
6,000
+ Units started into production during the month
50,000
- Units completed and transferred out during the month
44,000
= Work in process, ending
12,000

 
Equivalent Units of Production:
 
 
Materials
Transferred to next department
44,000
Ending work in process
 
     (conversion: 17,000 units x 10% complete)
12,000
Equivalent units of production
56,000

 
Cost per Equivalent Unit:
 
 
Materials
Cost of beginning work in process
$3,000
Cost added during the period
25,560
Total cost (a)
28,560
 
 
Equivalent units of production (b)
56,000
Cost per equivalent unit (a) / (b)
$0.51

 
Ending Work in Process Inventory:
 
 
Materials
Equivalent units of production
 (materials 12,000 units  - 100% complete)
12,000
Cost per equivalent unit
$0.51
Ending work in proces inventory
$6.120

 
Points Received:
5 of 5
 
Comments:
Great job

 4.
Question :
(TCO F) The journal entry to record the incurrence of indirect labor costs is:

 
Student Answer:

a
Wages Payable
XXX

Manufacturing Overhead

XXX

 

b
Work In Process
XXX

Wages Payable

XXX

 

XX c
Manufacturing Overhead
XXX

Wages Payable

XXX

 

d
Wages Payable
XXX

Work in Process

XXX

 
Instructor Explanation:
Chapter  3

 
Points Received:
5 of 5
 
Comments:
Great job

 5.
Question :
(TCO F) During December at Ingrim Corporation, $74,000 of raw materials were requisitioned from the storeroom for use in production. These raw materials included both direct and indirect materials. The indirect materials totaled $6,000. The journal entry to record the requisition from the storeroom would include a:

 
Student Answer:

debit to Raw Materials of $74,000.
 

XX debit to Work in Process of $68,000.
 

credit to Manufacturing Overhead of $6,000.
 

debit to Work in Process of $74,000.
 
Instructor Explanation:
Chapter 3

 
Points Received:
5 of 5
 
Comments:
Great job

 6.
Question :
(TCO F) Wedd Corporation had $35,000 of raw materials on hand on May 1. During the month, the company purchased an additional $68,000 of raw materials. During May,...
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