acct chapter 4

examples of products that may use operation costing include

- shoes - jewelry - clothing

in process costing, manufacturing overhead costs are distributed to each department

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

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

when production is completed in the last processing department, units are transferred to

finished good

when using process costing, materials can be added

in any processing department

work is performed on products and materials, labor, and overhead costs are added to products in a

processing department

operations costing is similar to process costing because

labor and overhead costs are accumulated by operation or department

when using process costing, each processing department has a separate

work in process account

job-order costing is used for

many different products with unique production requirements

industries that convert raw materials into homogeneous products typically use

process costing

the equivalent units completed are valued the same as unit ________________ for purposes of determining the cost per unit

transferred out

characteristics of operation costing include

- costs are accumulated by department - products are processed in batches

processing department produces

- identical units - homogeneous units

weighted average method

combines costs and outputs from the current and prior periods

the journal entry to record material cost in the second department would include a _____ to Work in Process -Department 2

debit

the entry to record the sale of finished goods to customers is a

debit cost of goods sold credit finished goods

number of partially completed units x percentage completion

equivalent units

similarities between job-order costing and process costing include

- flow of costs through the manufacturing accounts - manufacturing accounts used - basic purpose to assign and compute product costs

when using process costing, which of the following can be added in any department

- materials - labor - overhead

differences between job-order and process costing include that process costing

- used for indistinguishable products - accumulates costs by department

process costing accumulates costs by

department

the difference om the treatment of costs transferred in from Department A to Department B when compared to materials and conversion costs is that costs transferred in

will always be 100% complete with respect to Department A

recording the transfer of partially completed products from one processing department to another, requires a journal entry that affects the _____ account of both processing departments

work in process

FIFO method

Bases costs solely on the costs and outputs from the current period

the journal entry to record the transfer of partially completed products from processing department #1 to #2 is to

Debit Work in Process #2 Credit Work in Process #1

the journal entry to record the transfer of completed units to the finished goods warehouse is to

Debit finished goods Credit work in process

the journal entry to apply overhead cost to processing Department #1 is to

Debit work in process Credit manufacturing overhead

conversion cost

direct labor plus manufacturing overhead