BUS202-03_ Ch. 20 Quiz

Which of the following costs incurred by a paper manufacturer would be included in the group of costs referred to as conversion costs? a. assembly labor's wages b. raw lumber c. administrative salaries d. accounting department costs

a. assembly labor's wages

In process cost accounting, the costs of direct materials and direct labor are charged directly to a. processing departments b. customer accounts receivable c. job orders d. service departments

a. processing departments

In the manufacture of 10,000 units of a product, direct materials cost incurred was $165,000, direct labor cost incurred was $105,000, and applied factory overhead was $53,000. What is the total conversion cost? a. $218,000 b. $158,000 c. $323,000 d. $53,000

b. $158,000

Use this information about Penny, Inc. to answer the question that follow. Penny, Inc. employs a process costing system. Direct materials are added at the beginning of the process. Here is information about the July activities: On July 1: Beginning inventories 850 units, 60% complete Direct materials cost $5,000 Conversion costs $4,000 During July: Number of units started 15,000 Direct materials added $155,000 Conversion costs added $83,520 On July 31: Ending inventories 1,600 units, 40% complete Using the FIFO method, the number of units started and completed in July was a. 14,250 b. 15,740 c. 13,400 d. 15,000

c. 13,400

A form prepared periodically for each processing department summarizing the units for which the department is accountable and the units to be assigned costs and the costs charged to the department and the allocation of these costs is termed a a. manufacturing cost report b. process cost report c. cost of production report d. factory overhead production report

c. cost of production report

For which of the following businesses would a process cost system be appropriate? a. custom furniture manufacturer b. boat repair service c. shampoo manufacturer d. dressmaker

c. shampoo manufacturer

Lean manufacturing attempts to significantly reduce a. profits b. processing time c. waste and simplify the production process d. inventory needed to produce products

c. waste and simplify the production process

If a company uses a process costing system to account for the costs in its five production departments, how many work in process accounts will it use? a. 4 b. 2 c. 6 d. 5

d. 5

Department S had 500 units 60% completed in process at the beginning of the period, 9,000 units completed during the period, and 600 units 30% completed at the end of the period. What was the number of equivalent units of production for the period for conversion if the first-in, first-out method is used to cost inventories? Assume the completion percentage applies to both direct materials and conversion cost. a. 9,000 b. 8,700 c. 9,300 d. 8,880

d. 8,880

Equivalent production units are generally determined for a. conversion costs only b. direct materials and direct labor costs only c. direct materials only d. direct materials and conversion costs

d. direct materials and conversion costs