14/5/2014 Chapter 8 Fall Final 2012 flashcards | Quizlet

http://quizlet.com/17375969/chapter-8-fall-final-2012-flash-cards/ 1/5

Created by hannawagenfeld
Original Alphabetical
Process costing assumes all units are
homogeneous and follow the same path
through the production process.
True
The number of units in the beginning
Work-in-Process Inventory plus the
units transferred out during the period
equals the number of units started during
the period plus the number of units in the
ending Work-in-Process Inventory.
False
If materials are added continuously
throughout the production process, then
the equivalent units for materials will
normally equal the equivalent units for the
conversion costs.
True
If materials are only added at the
beginning of the production process, then
the degree of completion for materials in
the ending Work-in-Process Inventory is
always 100%.
True
If materials are only added at the end of
the production process, then the degree
of completion for materials of units in the
ending Work-in-Process Inventory is
always 0%.
True
The weighted-average approach to
process costing combines the work and
costs done in prior periods with the
work and costs done in the current
period.
True
14/5/2014 Chapter 8 Fall Final 2012 flashcards | Quizlet
http://quizlet.com/17375969/chapter-8-fall-final-2012-flash-cards/ 2/5
The more prices change, the greater the
difference between the costs assigned to
units transferred out using weighted-
average costing and the costs assigned to
units transferred out using first-in, first-
out (FIFO).
True
In general, weighted-average costing is
simpler to use while first-in, first-out
(FIFO) costing provides greater
decision-making benefits to managers.
True
Job costing requires more detailed
recordkeeping than process costing.
True
An equivalent unit of conversion costs is
equal to the amount of conversion costs
required to
start and complete a unit
Which of the following statements
concerning a process cost accounting
system is false?
The units in beginning inventory plus the
units transferred out during the month
should equal the units in the ending
inventory plus the units transferred in
during the month.
In the computation of the manufacturing
cost per equivalent unit, the weighted
average method of process costing
considers
current costs plus cost of beginning
Work-in-Process Inventory
Blue Company has beginning and ending
Work-in-Process Inventories that are
45% and 10% complete, respectively.
Materials are added at the beginning of
the process. If first-in, first-out (FIFO)
process costing is used, the total
equivalent units for materials will equal
the number of units
started into the process during the
period.
14/5/2014 Chapter 8 Fall Final 2012 flashcards | Quizlet
http://quizlet.com/17375969/chapter-8-fall-final-2012-flash-cards/ 3/5
An error was made by ROC Company
in computing the percentage-of-
completion of the current year's ending
Work-in-Process Inventory. The error
resulted in the assignment of a lower
percentage of completion to each
component of the inventory than actually
was the case. There was no beginning
Work-in-Process Inventory. What is the
effect of this error on (1) cost assigned
to cost of goods completed for the
period and (2) the computation of costs
per equivalent unit?
Overstated Overstated
Additional materials are added in the
second department of a four-department
production process. However, this
addition does not increase the number of
units being produced in the second
department, but will
increase the total cost per unit.
Under which of the following conditions
will the FIFO method produce the same
cost of goods manufactured as the
weighted-average method?
There is no beginning inventory.
Which of the following statements is
(are) true?
I. For cost control, the FIFO method of
process costing is better than the
weighted-average method.
II. The weighted-average method of
process costing assigns more cost to
units completed (transferred out) than the
FIFO method.
I only.
Which of the following statements is
(are) false?
(A) Operations costing accounts for
material costs like job costing and
conversion costs like process costing.
(B) An automobile manufacturer is more
likely to use an operations costing system
than a process costing system.
Neither A nor B.
14/5/2014 Chapter 8 Fall Final 2012 flashcards | Quizlet
http://quizlet.com/17375969/chapter-8-fall-final-2012-flash-cards/ 4/5
Predetermined manufacturing overhead
rates can be used in all of the following
costing systems except
actual costing.
ABC Company has a beginning Work-
in-Process Inventory of 25,000 units
(40% complete). During the period,
110,000 units were started and the
ending Work-in-Process Inventory
consisted of 20,000 units (80%). What
are the equivalent units for conversion
costs using weighted-average process
costing?
131,000
Sussex Corporation's production cycle
starts in the Mixing Department. The
following information is available for
April:
Work in process April 30 (60%
complete) 25,000
Total units in process during April
280,000
Work in process April 1 (25%
complete) 40,000
Materials are added at the beginning of
the process in the Mixing Department.
What are the equivalent units of
production for the month of April,
assuming Sussex uses the weighted
average method?
280,000 270,000
14/5/2014 Chapter 8 Fall Final 2012 flashcards | Quizlet
http://quizlet.com/17375969/chapter-8-fall-final-2012-flash-cards/ 5/5
Department A had no Work-in-Process
at the beginning of the period, 1,000
units were completed during the period,
200 units were 50% completed at the
end of the period, and the following
manufacturing costs were debited to the
departmental Work-in-Process account
during the period
Direct Materials (1,200 at $10) $12,000
Direct Labor $5,500
Factory Overhead $4,400
Assuming that all direct materials are
placed in process at the beginning of
production and Department A uses
weighted-average process costing, what
is the total cost of the departmental
Work-in-Process Inventory at the end of
the period?
$2,900
The Finishing Department had 5,000
incomplete units in its beginning Work-
in-Process Inventory which were 100%
complete as to materials and 30%
complete as to conversion costs. 15,000
units were received from the previous
department. The ending Work-in-
Process Inventory consisted of 2,000
units which were 50% complete as to
materials and 30% complete as to
conversion costs. The Finishing
Department uses first-in, first-out (FIFO)
process costing.
How many units were transferred-out
during the period?
18,000