Quiz 5

Which of the following statements is true? -In a process-costing system, each unit uses approximately the same amount of resources. -In a job-costing system, average production cost is calculated for all units produced. -In a process-costing system, individual jobs use different quantities of production resources. -In a job-costing system, overheads are allocated to all units equally

In a process-costing system, each unit uses approximately the same amount of resources.

Vital Industries manufactured 1,200 units of its product Huge in the month of April. It incurred a total cost of $120,000 during the month. Out of this $120,000, $45,000 comprised of direct materials used in the product and the rest was incurred because of the conversion cost involved in the process. Ryan had no beginning or ending work-in-process inventory. What will be the total cost per unit of the product, assuming conversion costs contained $10,000 of indirect labor? -$30 -$70 -$100 -$90

$100

Shiffon Electronics manufactures music player. Its costing system uses two cost categories, direct materials and conversion costs. Each product must pass through the Assembly Department, the Programming department, and the Testing Department. Direct materials are added at the beginning of the production process. Conversion costs are allocated evenly throughout production. Shiffon Electronics uses weighted-average costing. The following information is available for the month of March 2015 for the Assembly department. Work in process, beginning inventory 300 units Conversion costs (30% complete) Units started during April 800 units Work in process, ending inventory: 100 units Conversion costs (50% complete) The cost details for the month of March are as follows: Work in process, beginning inventory: Direct materials $345,000 Conversion costs $360,000 Direct materials costs added during April $700,000 Conversion costs added during April $1,120,000 What is the total amount debited to the Work-in-Process account during the month of March? -$2,525,000 -$1,820,000 -$2,180,000 -$700,000

$1,820,000

Jane Industries manufactures plastic toys. During October, Jane's Fabrication Department started work on 10,000 models. During the month, the company completed 11,000 models, and transferred them to the Distribution Department. The company ended the month with 1,500 models in ending inventory. There were 2,500 models in beginning inventory. All direct materials costs are added at the beginning of the production cycle and conversion costs are added uniformly throughout the production process. The FIFO method of process costing is being followed. Beginning work in process was 25% complete as to conversion costs, while ending work in process was 50% complete as to conversion costs. Beginning inventory: Direct materials costs $19,200 Conversion costs $10,800 Manufacturing costs added during the accounting period: Direct materials costs $70,000 Conversion costs $240,000 What is the amount of direct materials cost assigned to ending work-in-process inventory at the end of October? -$10,500 -$7,720 -$17,202 -$22,727

$10,500

Jane Industries manufactures plastic toys. During October, Jane's Fabrication Department started work on 10,000 models. During the month, the company completed 11,000 models, and transferred them to the Distribution Department. The company ended the month with 1,500 models in ending inventory. There were 2,500 models in beginning inventory. All direct materials costs are added at the beginning of the production cycle and conversion costs are added uniformly throughout the production process. The FIFO method of process costing is being followed. Beginning work in process was 25% complete as to conversion costs, while ending work in process was 50% complete as to conversion costs. Beginning inventory: Direct materials costs $19,200 Conversion costs $10,800 Manufacturing costs added during the accounting period: Direct materials costs $70,000 Conversion costs $240,000 What is the cost assigned to ending inventory during October? -$26,678 -$38,000 -$28,725 -$31,536

$26,678

Shiffon Electronics manufactures music player. Its costing system uses two cost categories, direct materials and conversion costs. Each product must pass through the Assembly Department, the Programming department, and the Testing Department. Direct materials are added at the beginning of the production process. Conversion costs are allocated evenly throughout production. Shiffon Electronics uses weighted-average costing. The following information is available for the month of March 2015 for the Assembly department. Work in process, beginning inventory 300 units Conversion costs (30% complete) Units started during April 800 units Work in process, ending inventory: 100 units Conversion costs (50% complete) The cost details for the month of March are as follows: Work in process, beginning inventory: Direct materials $345,000 Conversion costs $360,000 Direct materials costs added during April $700,000 Conversion costs added during April $1,120,000 What amount of direct materials costs is assigned to the ending Work-in-Process account for March? -$31,363 -$75,075 -$95,000 -$63,636

$95,000

FIFO Aluminum processes a single type of aluminum. During the current period the following information was given: Beginning Inventory Units 3,000 Material Costs $4,500 Conversion Costs. $4,800 Started During the Current Period Units 20,000 Material Costs 48,000 Conversion Costs. 65,000 Ending Inventory units: 2,500 All materials are added at the beginning of the production process. The beginning inventory was 30% complete as to conversion, while the ending inventory was 40% completed for conversion purposes. FIFO Aluminum uses the first-in, first-out system of process costing. What were the costs assigned to the units transferred out this period (round equivalent unit cost to the nearest penny)? -$122,300 -$103,936 -$113,980 -$113,236

-$113,236

Assembly department of Zahra Technologies had 100 units as work in process at the beginning of the month. These units were 50% complete. It has 200 units which are 25% complete at the end of the month. During the month, it completed and transferred 500 units. Direct materials are added at the beginning of production. Conversion costs are allocated evenly throughout production. Zahra uses weighted-average process-costing method. What is the total equivalent units in ending inventory for assignment of direct materials cost? -50 units -200 units -25 units -150 units

200 units

Assembly department of Zahra Technologies had 100 units as work in process at the beginning of the month. These units were 50% complete. It has 200 units which are 25% complete at the end of the month. During the month, it completed and transferred 500 units. Direct materials are added at the beginning of production. Conversion costs are allocated evenly throughout production. Zahra uses weighted-average process-costing method. Calculate the total equivalent units in ending inventory for assignment of conversion costs? -150 units -50 units -200 units -25 units

50 units

Assembly department of Zahra Technologies had 100 units as work in process at the beginning of the month. These units were 50% complete. It has 200 units which are 25% complete at the end of the month. During the month, it completed and transferred 500 units. Direct materials are added at the beginning of production. Conversion costs are allocated evenly throughout production. Zahra uses weighted-average process-costing method. The number of equivalent units of work done during the month for direct materials is_______. -700 units -600 units -800 units -500 unit

600 units

Jane Industries manufactures plastic toys. During October, Jane's Fabrication Department started work on 10,000 models. During the month, the company completed 11,000 models, and transferred them to the Distribution Department. The company ended the month with 1,500 models in ending inventory. There were 2,500 models in beginning inventory. All direct materials costs are added at the beginning of the production cycle and conversion costs are added uniformly throughout the production process. The FIFO method of process costing is being followed. Beginning work in process was 25% complete as to conversion costs, while ending work in process was 50% complete as to conversion costs. Beginning inventory: Direct materials costs $19,200 Conversion costs $10,800 Manufacturing costs added during the accounting period: Direct materials costs $70,000 Conversion costs $240,000 How many of the units that were started and completed during October? -8,500 -9,000 -13,500 -10,000

8,500

Which of the following statements best describes conversion costs? -Conversion costs are all manufacturing costs other than direct materials costs. -Conversion costs are all manufacturing and nonmanufacturing cost. -Conversion costs are all nonmanufacturing costs other than fixed selling and distribution costs. -Conversion costs are all nonmanufacturing costs including marketing costs.

Conversion costs are all manufacturing costs other than direct materials costs.

The purpose of the equivalent-unit computation is to ________. -satisfy the GAAP requirements which requires all partially completed goods to be reported as equivalent-units -predict the future production capabilities of the organization -assist the business in determining the cost assigned to ending inventory and work-in-process inventory -convert completed units into the amount of partially completed output units that could be made with that quantity of input

assist the business in determining the cost assigned to ending inventory and work-in-process inventory

On occasion, the FIFO and the weighted-average methods of process costing will result in the same dollar amount of costs being transferred to the next department. Which of the following scenarios would have that result? -when the beginning and ending inventories are equal in terms of the percentage of completion for both direct materials, and conversion costs. -when the beginning and ending inventories are equal in terms of unit numbers. -when there is no ending inventory. -when there is no beginning inventory.

when there is no beginning inventory.