In process costing,goods are moved from the Assembly Department to the Packaging Department.Costs incurred in the Assembly Department for the goods received by the Packaging Department are called ________ by the Packaging Department.
A) equivalent units
B) finished goods
C) transferred-in costs
D) factory overhead applied

Question

Quizplus · Accepted Answer

The costs incurred in the Assembly Department for the goods received by the Packaging Department are called transferred-in costs. These costs include direct materials, direct labor, and manufacturing overhead costs that were incurred during the Assembly Department's production process. They are transferred to the Packaging Department and then allocated to the units produced in the Packaging Department. Therefore, choice C is the correct answer. Equivalent units refer to the number of units that are partially completed in a production process, finished goods are the products that have been completed and are ready for sale, and factory overhead applied refers to the amount of manufacturing overhead allocated to a particular job or department.

In Process Costing,goods Are Moved from the Assembly Department to the Packaging