Accounting 2020 Ch 5 Review

The journal entry to record the transfer of partially completed products from processing Department #1 to processing Department #2 is to debit Work in Process Department.

#2 and credit Work in Process-Department #1

To calculate cost per equivalent unit using the weighted-average method, add the cost of _____ work in process inventory to costs added during the period and divide by equivalent units of production.

beginning

Conversion costs are:

direct labor plus manufacturing overhead

When production is completed in the last processing department, units are transferred to the ____ ____ account.

finished goods

Using the weighted-average method, if work in process inventory has 100 units that are 40% complete and 300 units were transferred to the next department during the period, there are a total of _____ equivalent units of production.

340 300 + ( 100 x 40% ) = 340

The journal entry to record labor cost in the first department would be to _____ (debit/credit) Wages payable and _____ (debit/credit) Work in process-Department #1.

Credit / Debit

The correct journal entry to apply manufacturing costs to processing Department #1 would be to ____ (debit/credit) Manufacturing overhead and ____ (debit/credit) Work in process-Department #1.

Credit / debit

The journal entry to record the transfer of completed units to finished goods would be to _____ (debit/credit) Finished Goods and _____ (debit/credit) Work in Process.

Debit / Credit

Examples of products that may use operation costing include:

Jewelry, shoes, and clothing

When ending work in process contains 500 units that are 34% completed, there are _____ equivalent units.

170 Units 500 X 34% = 170

Units in _____ work in process inventory + units started or transferred in = Units in ______ work in process inventory + units completed and transferred out.

beginning / ending

When many different jobs or products are worked on each period, the most likely costing system used is:

job-order

Costs in beginning work in process inventory was $4,500 and $37, 800 in costs were added during the period. Under the weighted-average method, if there are 7,050 equivalent units, the cost per equivalent unit is $ _____.

$6 $4,500 + $37,800 = 42,300 $42,300 / 7,050 = $6.00

When preparing a cost reconciliation report, costs to be accounted for include _____ work in process inventory, while costs accounted for include _____ work in process inventory.

Beginning / ending

To report ending inventory, partially completed units are translated into _____ units.

Equivalent

The equivalent units completed are valued the same as units ____ for purposes of determining the cost per unit.

transferred out

When using process costing, materials can be added ____ processing department.

in any

Equivalent units of production equals the number of units transferred to the next department (or finished goods) plus equivalent units in ending work in process under which method(s) of costing?

Weighted-average only

Operations costing is similar to process costing because:

labor and overhead costs are accumulated by operations or department

A company's beginning work in process contained 200 units that were 20% complete. Those units were completed and transferred to finished goods. During the period 4,300 units were started. Of the units started, 4,000 were transferred to finished goods. The 300 units in ending work in process were 30% complete. Using the weighted-average method, the equivalent units of production equals ______.

$4,290 Beginning WIP (200)+ started and completed (4,000) = 4,200 units transferred out + 300 units in ending WIP x 30% complete (300 x .30 = 90) = 4,290 equivalent units.

The journal entry to record direct materials costs in processing Department #1 is debit:

Work in process-Department #1 and credit Raw Materials

In process costing, manufacturing overhead costs are distributed to each department:

according to the amount of the allocation base incurred in the department

Operations costing is similar to job-order costing because:

each batch is charged for its own specific materials

Work is performed on products, and materials, labor, and overhead costs are added to products in a(n) ______ department.

processing

When unit costs are transferred from Department A to Department B, Department B will treat the costs as:

transferred in

The two common methods for determining unit product costs are:

Job-order costing and process costing

The entry to record the sale of finished goods to customers is a debit to:

Cost of goods sold and a credit to finished goods

Identify where the following items appear on a cost reconciliation report:

Costs to be accounted for: - Cost of beginning work in process inventory. - Costs added to production during the period. Costs accounted for: -Costs of units transferred out. -Cost of ending work in process inventory.

True or false: The equivalent units of production computed under the weighted- average method does not take into account the percentage completed of the beginning inventory.

True