Cost Accounting exam 2
Option D. January would be the same since there is no beginning WIP; weighted-average would be greater in February since the work already in the February 1 inventory is included in the equivalent units (but excluded from FIFO).
A process costing system was used for a department that began operations in January 2023. Approximately the same number of physical units, at the same degree of completion, were in work-in-process at the end of both January and February. Monthly conversion costs are allocated between ending work-in-process and units completed. Compared to the FIFO method, would the weighted-average method use the same or a greater number of equivalent units calculate the monthly allocations? (CPA adapted) Equivalent Units for Weighted Average compared to FIFO January February a. Same Same b. Greater Same c. Greater Greater D. Same Greater
uses separate Work-in-Process account for each processing department.
A process costing system:
final sales price reduced by cost to complete after split-off.
For purposes of allocating joint costs to joint products, the estimated net realizable value at split-off is equal to:
net realizable value at split-off
For the purposes of allocating joint costs to joint products, the sale price at the point sale, reduced by the cost to complete after split-off, is assumed to be equal to the: (CPA adapted)
separable cots after the split-off point
In joint product costing and analysis, which one of the following costs is relevant when deciding the point at which a product should be sold in order to maximize profits? (CMA adapted)
work-in-process inventory
In a process costing system, the application of factory overhead usually would be recorded as an increase in: (CPA adapted)
only current period costs.
In computing the current period's manufacturing cost per equivalent unit, the FIFO method of process costing considers: (CPA adapted)
Option A.
In process2, material G is added when a batch is 60% complete. Ending work-in-process units, which are 50% complete, would be included in the computation of equivalent units for: (CPA adapted) Conversion Costs Material G a. Yes No b. No Yes c. No No D. Yes Yes
Should be ignored in determining whether to sell at split-off or process further.
Joint processing costs in the operation
Option B
Net realizable value at the split-off point is used to allocate: Cost After Split-off Point Incurred Joint Costs a. No No b. No Yes c. Yes No d. Yes yes
Option C. Stevens product is homogenous and Northridge's product is heterogeneous.
The following examples briefly describe the manufacture of two different products. Which coting method (Job or process) would be the best method to use for each project? I. Steven Lawless manufactures Lawless Fine Wine Coolers. Steven once made the statement, "People can have any flavor of Lawless Fine Wine Coolers they want as long it's strawberyy." II. Northridge Spacetronics is manufacturing three space shuttles for the country of Xanadu. Each shuttle is slightly different, and the production will last approximately two years. I II A. Process Process b. Job-order Job-order c. Process Job-order d. Job-order process
net realizable value method
The method of accounting for joint product costs that will produce the same gross margin percentage for all products is the:
Inventory valuation
Which of the following best describes the objective of joint cost allocation?
Freight-out
Which of the following cost items is not allocable as joint costs when a single manufacturing process produces several main products and several by-products?
Dollars of labor
Which of the following is not a physical measure that can be used for allocating joint costs using the physical quantities method?
Determining how to allocate joint costs to the final products
Which of the following is not a step needed to maximize the profits from joint products?
Revenues from selling or processing beyond the split-off point and additional expenditures for further processing are relevant.
Which of the following statements about maximizing the profile of joint product processes is true?
The estimated net realizable value for a product is its estimated selling price after processing the product beyond the split-off point.
Which of the following statements is false?
