Quiz: Traditional Costing Methods (Managerial Accounting)

Which is not needed to compute the equivalent units of production? > the material cost per unit > the number of units transferred out > the percentage of completion for inventory still in process > the number of units started and completed

the number of units transferred out

Burnham Industries incurs these costs for the month: > Direct Materials: $2000 > Direct Labor: $3000 > Factory Depreciation Expense: $3500 > Factory Utilities Expense: $750 > CEO's Salary: $4000 A. What is the prime cost? B. What is the conversion cost?

A. 5000 B. 7250

Which of the following is a conversion cost? > factory depreciation expense > administrative expenses > raw materials > direct materials

Factory

Which of the following product situations is better suited to job order costing than to process costing? > Costs are accumulated by department. > Each product batch is exactly the same as the prior batch. > The costs are easily traced to a specific product. > The value of work in process is based on assigning standard costs.

The costs are easily traced to a specific product.

During production, how are the costs in process costing accumulated? > to each individual product > to manufacturing overhead > to each individual department > to cost of goods sold

to each individual department

Process costing is used to account for: > finished goods that are refined and processed further. > raw materials that are converted directly to finished goods. > large numbers of products that are produced in a non-repetitive process. > large numbers of identical products that are produced in a continuous manufacturing environment.

large numbers of identical products that are produced in a continuous manufacturing environment.

In a job order cost system, overhead applied is debited to which account? > cost of goods sold > manufacturing overhead > work in process inventory > finished goods inventory

work in process inventory