acct505_week_2_quiz.docx
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1. (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: (Points : 5)
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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.
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Question 2. 2. (TCO F) Process costing would be appropriate for each of the following except: (Points : 5)
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custom furniture manufacturing.
oil refining.
grain milling.
newsprint production.
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Question 3. 3. (TCO F) Assume there was no beginning work in process inventory and the ending work in process inventory is 70% complete with respect to conversion costs. Under the weighted-average method, the number of equivalent units of production with respect to conversion costs would be: (Points : 5)
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the same as the units completed.
less than the units completed.
the same as the units started during the period.
less than the units started during the period.
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Question 4. 4. (TCO F) The journal entry to record the incurrence of indirect labor costs is: (Points : 5)
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a
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Wages Payable
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XXX
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Manufacturing Overhead
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XXX
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b
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Work In Process
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XXX
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Wages Payable
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XXX
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c
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Manufacturing Overhead
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XXX
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Wages Payable
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XXX
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d
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Wages Payable
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XXX
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Work in Process
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XXX
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Question 5. 5. (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: (Points : 5)
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debit to Raw Materials of $74,000.
debit to Work in Process of $68,000.
credit to Manufacturing Overhead of $6,000.
debit to Work in Process of $74,000.
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Question 6. 6. (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, $92,000 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 $5,000. The debits to the Work in Process account as a consequence of the raw materials transactions in May total: (Points : 5)
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$92,000.
$0.
$68,000.
$87,000.
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Page 2
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Question 1. 1. (TCO F) Some companies use process costing and some use job-order costing. Which method a company uses depends on its industry. A number of companies in different industries are listed below:
i. Specialty coffee roaster (roasts small batches of specialty coffee beans)
ii. Custom aircraft builder
iii. Brick manufacturer
iv. Microbrewery that produces a number of different beers
v. Steel company making chain link fences from iron ore
For each company, indicate whether the company is most likely to use job-order costing or process costing. (Points : 15)
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Page 2
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Question 1. 1. (TCO F) Some companies use process costing and some use job-order costing. Which method a company uses depends on its industry. A number of companies in different industries are listed below:
i. Specialty coffee roaster (roasts small batches of specialty coffee beans)
ii. Custom aircraft builder
iii. Brick manufacturer
iv. Microbrewery that produces a number of different beers
v. Steel company making chain link fences from iron ore
For each company, indicate whether the company is most likely to use job-order costing or process costing. (Points : 15)
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3. (TCO F) Auger Inc. uses the weighted-average method in its process costing system. The following data concern the operations of the company's first processing department for a recent month.
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Work in process, beginning
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Units in process
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700
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Percent complete with respect to materials
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80%
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Percent complete with respect to conversion
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40%
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Costs in the beginning inventory:
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Materials cost
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$1,904
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Conversion cost
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$8,624
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Units started into production during the month
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29,000
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Units completed and transferred out
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28,800
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Costs added to production during the month:
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Materials cost
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$104,044
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Conversion cost
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$875,266
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Work in process, ending:
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Units in process
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900
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Percent complete with respect to materials
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70%
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Percent complete with respect to conversion
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20%
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Required:
i. Determine the equivalent units of production.
ii. Determine the costs per equivalent unit.
iii. Determine the cost of ending work in process inventory.
iv. Determine the cost of the units transferred to the next department (Points : 15)
4. (TCO F) Hunsicker Corporation has provided the following data for the month of January:
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Inventories
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Beginning
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Ending
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Raw materials
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$30,000
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$33,000
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Work In process
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$20,000
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$18,000
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Finished goods
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$52,000
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$60,000
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Additional Information
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Raw material purchases
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$63,000
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Direct labor costs
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$92,000
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Manufacturing overhead cost incurred
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$75,000
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Indirect materials included in manufacturing overhead costs incurred
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$6,000
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Manufacturing overhead cost applied to work in process
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$69,000
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Prepare a Schedule of Cost of Goods Manufactured and a Schedule of Cost of Goods Sold in good form.
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