Question 1

Use the information below to answer the following questions:
Brooks Corporation uses the weighted-average method for process costing and has two sequential processing departments: Assembly then Shaping. The Shaping Department reports the following information.
 
-At Brooks Corporation the total cost of units transferred to finished goods would be closest to

Accepted Answer

C)
 11ea895a_93bc_89b7_861b_85d277a2a193_TB1238_00 11ea895a_93bc_b0c8_861b_e7c44caf222f_TB1238_00

Question 2

Conceptually transferred-in costs from another department are similar to

Accepted Answer

The answer of Conceptually transferred-in costs from another department are...

Question 3

Which of the following is an error when accounting for transferred-in costs?

Accepted Answer

Transferred-in costs are costs incurred by a product in previous departments that are carried forward as the product's cost basis when it moves to a subsequent department. The error mentioned in option D, considering costs assigned at the beginning of the period when calculating costs to be transferred on a weighted average basis, is incorrect because transferred-in costs should be based on the actual costs incurred up to the point of transfer, not on costs assigned at the beginning of the period. Options A, B, and C describe standard practices in accounting for transferred-in costs.

Question 4

A transfer of $24,000 from the assembly department to the packaging department would require the entry of a

Accepted Answer

When transferring costs from one department to another within the manufacturing process, the department transferring out the costs (in this case, the assembly department) would credit its work in process (WIP) inventory to reduce its balance, reflecting the move of costs to the next stage (packaging department).

Question 5

ABC produces ping-pong balls using a three-step sequential process that includes molding, colouring and finishing. When the balls and associated costs are transferred out of the colouring process and into the finishing process, the journal entry would include a

Accepted Answer

When the balls and their costs are transferred from the coloring process to the finishing process, it means that the finishing process has taken over the production of the ping-pong balls. Therefore, there would be a transfer of costs from the WIP (work-in-progress) inventory of the coloring process to the WIP inventory of the finishing process. This would involve debiting the WIP inventory of the finishing process and crediting the WIP inventory of the coloring process. Therefore, option B is the correct answer. Options A, C, and D are not correct because they do not adequately reflect the transfer of costs between the two processes.

Question 6

ABC produces ping-pong balls using a three-step sequential process that includes molding, colouring and finishing. When the balls and associated costs are transferred from the molding process to the colouring process, which account is debited?

Accepted Answer

When the balls and associated costs are transferred from the molding process to the colouring process, the Work in Process (WIP) inventory for the colouring process is debited. This reflects the movement of the balls into the next stage of production and the associated costs being allocated to that stage.

Question 7

Use the information below to answer the following questions:
Brooks Corporation uses the weighted-average method for process costing and has two sequential processing departments: Assembly then Shaping. The Shaping Department reports the following information.
 
-At Brooks Corporation what is the total number of equivalent units for direct materials?

Accepted Answer

The total number of equivalent units for direct materials at Brooks Corporation is calculated by adding the units completed and transferred out to the equivalent units in ending work in process inventory for direct materials. Without specific data provided in the question, the correct answer is based on common accounting practices for calculating equivalent units in a process costing system.

Question 8

Use the information below to answer the following questions:
Goody Company adds direct materials at the beginning of the process and adds conversion costs throughout the process. The company uses the weighted-average method for process costing. Data for the finishing department follows:
 
-What are the equivalent units for direct materials at Goody Company?

Accepted Answer

Equivalent units for direct materials are calculated based on the units of production and the stage of completion for those units. Without specific details on the production process, materials added at different stages, or the percentage completion of those materials, it's impossible to provide a detailed explanation. However, given the answer choice, it suggests that the calculation based on the provided data results in 57,000 equivalent units for direct materials at Goody Company.

Question 9

Use the information below to answer the following questions:
Brooks Corporation uses the weighted-average method for process costing and has two sequential processing departments: Assembly then Shaping. The Shaping Department reports the following information.
 
-At Brooks Corporation the total cost of units in ending WIP inventory-Shaping would be closest to

Accepted Answer

C)
 11ea895a_93bc_89b5_861b_d3c1988cc98d_TB1238_00 11ea895a_93bc_89b6_861b_69aee502b1a8_TB1238_00

Question 10

Hibury Company has two sequential processing departments: Assembly then Shaping. The Shaping Department reports the following information. Conversion costs are applied evenly throughout the process.  
What would have been the journal entry to record the transfer of product from the assembly department to the shaping department?

Accepted Answer

The answer of Hibury Company has two sequential processing departments:...

Question 11

Use the information below to answer the following questions:
Goody Company adds direct materials at the beginning of the process and adds conversion costs throughout the process. The company uses the weighted-average method for process costing. Data for the finishing department follows:
 
-At Goody Company what are the equivalent units for conversion costs?

Accepted Answer

The answer of Use the information below to answer the...

Question 12

Beta Tools Ltd. uses the weighted-average method of process costing. Materials are added at the beginning of the machining process and conversion costs are added evenly throughout the process. The following activity occurred in its Machining Department during April.
Units:
  Costs:
  
Required
1. Summarize flow of physical units and compute total equivalent units for three cost categories: transferred-in, direct materials, and conversion costs.
2. Summarize total costs to account for and compute the cost per equivalent unit for each cost category.
3. Assign total costs to (a) units completed and transferred to Finished Goods Inventory and (b) units in April 30 Work in Process Inventory.

Accepted Answer

The answer of Beta Tools Ltd. uses the weighted-average method...

Question 13

ABC produces ping-pong balls using a three-step sequential process that includes molding, colouring and finishing. When the balls and associated costs are transferred from the molding process to the colouring process, which account is credited?

Accepted Answer

When the balls and associated costs are transferred from the molding process to the colouring process, the WIP inventory account for the molding process is credited since the costs are leaving that process and entering the next.

Question 14

At Madson Distillery the company uses the weighted-average method of process costing. Direct materials are added at the beginning of the process and conversion costs are added throughout the process. Data for the finishing department follows:
  
Required:
A. What are the equivalent units for conversion costs?
B. What is the cost per equivalent unit for conversion costs?
C. What are the equivalent units for direct materials?
D. What is the total number of physical units for which to account?

Accepted Answer

The answer of At Madson Distillery the company uses the...

Question 15

Beta Tools Ltd. uses the weighted-average method of process costing. Materials are added at the beginning of the machining process and conversion costs are added evenly throughout the process. The following activity occurred in its Machining Department during November.
Units:
  Costs:
  
Required
1. Summarize flow of physical units and compute total equivalent units for three cost categories: transferred-in, direct materials, and conversion costs.
2. Summarize total costs to account for and compute the cost per equivalent unit for each cost category.
3. Assign total costs to (a) units completed and transferred to Finished Goods Inventory and (b) units in November 30 Work in Process Inventory.

Accepted Answer

The answer of Beta Tools Ltd. uses the weighted-average method...

Question 16

Blousson Company has two sequential processing departments: Assembly then Shaping. The Shaping Department reports the following information. Conversion costs are applied evenly throughout the process.  What would have been the journal entry to record the transfer of product from the assembly department to the shaping department?

Accepted Answer

The answer of Blousson Company has two sequential processing departments:...

Question 17

At Polson Company the total cost of units transferred to finished goods is closest to

Accepted Answer

B)
 11ea895a_93bc_3b93_861b_6b7114f60b86_TB1238_00

Question 18

Use the information below to answer the following questions:
Brooks Corporation uses the weighted-average method for process costing and has two sequential processing departments: Assembly then Shaping. The Shaping Department reports the following information.
 
-What is the total number of equivalent units for conversion costs at Brooks Corporation?

Accepted Answer

The answer of Use the information below to answer the...

Question 19

Use the information below to answer the following questions:
Goody Company adds direct materials at the beginning of the process and adds conversion costs throughout the process. The company uses the weighted-average method for process costing. Data for the finishing department follows:
 
-At the Goody Company the cost per equivalent unit for conversion costs would be closest to

Accepted Answer

To calculate the cost per equivalent unit for conversion costs, we need to divide the total conversion costs incurred during the period by the equivalent units of production for conversion costs.

Total conversion costs = $119,160 
Equivalent units of production for conversion costs = 24,000 (from the given data)

Cost per equivalent unit for conversion costs = Total conversion costs / Equivalent units of production for conversion costs 
= $119,160 / 24,000 
= $4.965 per equivalent unit

The closest option is C, $4.95.

Question 20

Use the information below to answer the following questions:
Goody Company adds direct materials at the beginning of the process and adds conversion costs throughout the process. The company uses the weighted-average method for process costing. Data for the finishing department follows:
 
-The total number of physical units for which we have to account is

Accepted Answer

The total physical units for which we have to account are 60,000 (starting WIP: 10,000 + units started and completed: 50,000). However, some of these units may still be in process (ending WIP: 3,000), so the equivalent units of production for the finishing department are 57,000 (10,000 + 47,000).

Quiz 6: Process Costing