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Exam 28: Process Cost Accounting

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Question 1

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At the end of the month, the balance in the Manufacturing Overhead control account is closed into the departmental work in process accounts.

A) True
B) False

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Question 2

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In the ____________________ cost accounting system, costs for materials, labor, and manufacturing overhead are charged to the Work in Process Inventory accounts of the producing departments.

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Question 3

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In a process cost accounting system, the average unit cost of a product is determined by dividing the total manufacturing cost incurred by the number of units placed in production during the period.

Materials issued to production are recorded by ____________________ the departmental work in process accounts.

At the end of the month, the entry to close the Manufacturing Overhead control account includes a ____________________ to Manufacturing Overhead.

-Calculate the equivalent production units from the information given.

Fill in the blanks in the Quantity Section of the following Production Report.

To obtain meaningful unit costs in a process cost accounting system, the work accomplished must be measured in ____________________ production units.

The source of the cost data that appears in a cost of production report is

Equivalent production units are determined for materials and labor but not for manufacturing overhead.

When the average cost method is used, units in beginning inventory which are 40 percent complete are multiplied by 60 percent to compute equivalent units of production.

Materials issued to production are recorded by debiting Raw Materials Inventory and crediting the departmental work in process accounts.

Jocund Manufacturing produces exercise machines. In February, all the materials issued to Department X were entered into production. There was no beginning inventory. Department X started 6,100 units. During February, 5,300 units were transferred out-4,750 to Department Y and 550 to Finished Goods. Of the 900 units in ending inventory, 65% of the labor and overhead had been added during the month. Calculate the equivalent units of production for material and for Labor and Manufacturing Overhead.

Department R Cost Data for November 2013 $\begin{array}{lr}\text { Current department costs--November: } & \\\text { Materials } & \$ 51,121 \\\text { Labor } & 11,304 \\\text { Manufacturing Overhead } & 9,106\\\text { Quantities: }\\\text { Beginning inventory, work in process } & -0-\text { units } \\\text { Started in production } & 6,700 \text { units } \\\text { Transferred out to next department } & 6,000 \text { units } \\\text { Ending inventory, work in process } & 700 \text { units }\\\text { Stage of completion--work in process: }\\\text { Ending inventory: }\\\text { Materials } & 100 \% \\\text { Labor and overhead } & 40 \%\end{array}$ -Explain the flow of production in a manufacturing environment for production as the products are started and moved through the production process and eventually sold. Include the account titles.

Fraser Manufacturing had no work in process at the beginning of a month. It transferred 6,000 units to finished goods during the month, and 800 units were still in process at the end of the month. Equivalent production for the month was 6,480 units. At what stage of completion were the unfinished units at the end of the month?

The ending balance of a(n) ____________________ Inventory account for a producing department must agree with the amount shown for that department in the cost of production report.

When finished goods are sold, the entry to record the cost of goods sold includes a ____________________ to the Cost of Goods Sold account.

Cost data for a firm's first department, Dept. A, for June 2013 is given below. -Prepare a cost of production report for the month of June from the information given.

The Vinh Corporation has two producing departments. Cost data from the firm's records for the month of January 2013 is given below. There were no beginning inventories. -Prepare a cost of production report for the Assembling Department.

The current department costs categories are