DEVRY ACCT505 WEEK 2 QUIZ

A(TCO F) For which situation(s) below would an organization be more likely to use a job-order costing system of accumulating product costs rather than a process costing system?

Student Answer: A steel factory that processes iron ore into steel bars

A factory that processes sugar and other ingredients into black licorice

A costume maker that makes specialty costumes for figure skaters

All of these

Question 2. Question :

(TCO F) Process costing would be appropriate for each of the following except:

custom furniture manufacturing.

oil refining.

grain milling.

newsprint production.

Question 3. Question :

(TCO F) Assume there was no beginning work in process inventory and the ending work in process inventory is 70% complete with respect to conversion costs. Under the weighted-average method, the number of equivalent units of production with respect to conversion costs would be:

the same as the units completed.

less than the units completed.

the same as the units started during the period.

less than the units started during the period.

Question 4. Question :

(TCO F) Which of the following accounts is debited when direct labor is recorded?

Work in process

Salaries and wages expense

Salaries and wages payable

Manufacturing overhead

Question 5. Question :

(TCO F) During October, Crusan Corporation incurred $62,000 of direct labor costs and $4,000 of indirect labor costs. The journal entry to record the accrual of these wages would include a:

debit to Work in Process of $66,000.

credit to Work in Process of $66,000.

debit to Work in Process of $62,000.

credit to Work in Process of $62,000.

Question 6. Question :

(TCO F) Wedd Corporation had $35,000 of raw materials on hand on May 1. During the month, the company purchased an additional $68,000 of raw materials. During May, $92,000 of raw materials were requisitioned from the storeroom for use in production. These raw materials included both direct and indirect materials. The indirect materials totaled $5,000. The debits to the Work in Process account as a consequence of the raw materials transactions in May total:

$92,000.

$0.

$68,000.

$87,000.

(TCO F) Whether a company uses process costing or job-order costing depends on its industry. A number of companies in different industries are listed below:

i. Brick manufacturer

ii. Contract printer that produces posters, books, and pamphlets to order

iii. Natural gas production company

iv. Dairy farm

v. Coal mining company

vi. Specialty coffee roaster (roasts small batches of specialty coffee beans)

For each company, indicate whether the company is most likely to use job-order costing or process costing.

Question 2. Question :

(TCO F) Job 484 was recently completed. The following data have been recorded on its job cost sheet:

Direct materials

$57,240

Direct labor hours

1,692 DLHs

Direct labor wage rate

$12 per DLHS

Number of units completed

3,600 units

The company applies manufacturing overhead on the basis of direct labor-hours. The predetermined overhead rate is $24 per direct labor-hour.

Compute the unit product cost that would appear on the job cost sheet for this job.

Question 3. Question :

(TCO F) Harmon Company uses the weighted-average method in its process costing system. The Curing Department of Harmon Company reported the following information for the month of November.

Units Percentage complete with respect to conversion

Work in process, November 1 10,000 80%

Units started 28,000

Completed and transferred out 30,000

Work in process, November 30 8,000 30%

Costs for November Materials Conversion

Work in process, November 1 $34,500 $48,600

Added during the month $146,000 $194,400

All materials are added at the beginning of the process.

Required: Compute the following items using the weighted-average method:

i. The equivalent units of production for materials.

ii. The cost per equivalent unit for conversion.

iii. The total cost assigned to units transferred out of the Curing Department during November.

iv. The cost assigned to work in process inventory as of November 30.

Question 4. Question :

(TCO F) Weisinger Corporation has provided the following data for the month of January:

Inventories

Beginning

Ending

Raw materials

$28,000

$29,000

Work In process

$16,000

$14,000

Finished goods

$42,000

$54,000

Additional Information

Raw material purchases

$56,000

Direct labor costs

$87,000

Manufacturing overhead cost incurred

$51,000

Indirect materials included in manufacturing overhead costs incurred

$3,000

Manufacturing overhead cost applied to work in process

$55,000

Prepare a Schedule of Cost of Goods Manufactured and a Schedule of Cost of Goods Sold in good form.