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Accounting
Q:
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Q:
Johnson Production Company uses just-in-time production and accounting methods. On June 1, Johnson sold 200 units of product for $12.00 per unit. Each unit included $8.00 of direct materials cost and $2.00 of conversion costs. Johnson recorded the revenues of $2,400 in one entry, and then recorded the cost of goods sold in a second entry. Which of the following correctly records the cost of goods sold?
A) Debit $2,000 to Cost of goods sold, credit $2,000 to Finished goods inventory.
B) Debit $2,000 to Finished goods, credit $1,600 to Raw and in-process, credit $400 to Conversion costs.
C) Debit $1,600 to Conversion costs, debit $400 to Materials inventory, credit $2,000 to Cost of goods sold.
D) Debit $2,000 to Cost of goods sold, credit $2,000 to Raw and in-process inventory.
Q:
Johnson Production Company uses just-in-time production and accounting methods. On June 1, Johnson completed 400 units of product and moved the products to finished goods. Each unit included $8.00 of direct materials cost and $2.00 of conversion costs. Which of the following journal entries correctly records this transaction?
A) Debit $4,000 to Finished goods, credit $4,000 to Raw and in-process inventory.
B) Debit $4,000 to Finished goods, credit $3,200 to Raw and in-process, credit $800 to Conversion costs.
C) Debit $3,200 to Conversion costs, debit $800 to Materials inventory, credit $4,000 to Finished goods.
D) Debit $4,000 to Cost of goods sold, credit $3,200 to Materials inventory, credit $800 to Conversion costs.
Q:
Johnson Production Company uses just-in-time production and accounting methods. On June 1, Johnson paid $6,000 for factory repair and maintenance costs in cash. Which of the following journal entries correctly records this transaction?
A) Debit $6,000 to Cash, credit $6,000 to Manufacturing overhead.
B) Debit $6,000 to Raw and in-process inventory, credit $6,000 to Cash.
C) Debit $6,000 to Conversion costs, credit $6,000 to Cash.
D) Debit $6,000 to Manufacturing overhead, credit $6,000 to Cash.
Q:
Johnson Production Company uses just-in-time production and accounting methods. On June 1, Johnson paid direct labor costs of $5,000 in cash. Which of the following journal entries correctly records this transaction?
A) Debit $5,000 to Cash, credit $5,000 to Conversion costs.
B) Debit $5,000 to Conversion costs, credit $5,000 to Cash.
C) Debit $5,000 to Manufacturing overhead, credit $5,000 to Cash.
D) Debit $5,000 to Raw and in-process inventory, credit $5,000 to Cash.
Q:
Johnson Production Company uses just-in-time production and accounting methods. On June 1, Johnson purchased $4,000 of raw materials on account. Which of the following journal entries correctly records this transaction?
A) Debit accounts payable for $4,000, credit Raw and in-process inventory for $4,000.
B) Debit $4,000 to Materials inventory, credit $4,000 to Accounts payable.
C) Debit $4,000 to Work in process inventory, credit $4,000 to Accounts payable.
D) Debit $4,000 to Raw and in-process inventory, credit $4,000 to Accounts payable.
Q:
Which of the following is NOT a characteristic of just-in-time production?
A) "Demand-pull" system to initiate production
B) Small, self-contained work cells
C) Ultra-reliable suppliers
D) Surplus stocks maintained to protect against supply interruption
Q:
In a just-in-time costing system, any remaining balance in the conversion costs account at the end of an accounting period is usually cleared to which account?
A) Raw and in process inventory
B) Cost of goods sold
C) Work in process inventory
D) Finished goods inventory
Q:
In a just-in-time costing system, the entry to record the sale of a manufactured product would include which of the following?
A) Debit to cost of goods sold
B) Debit to finished goods inventory
C) Credit to raw and in process inventory
D) Credit to conversion costs
Q:
In a just-in-time costing system, the entry to record the standard cost of finished goods completed would include which of the following?
A) Debit to finished goods inventory
B) Debit to conversion costs
C) Debit to cost of goods sold
D) Credit to sales
Q:
In a just-in-time costing system, the entry to record direct material purchases on account would include which of the following?
A) Debit to raw and in process inventory
B) Credit to cash
C) Debit to materials inventory
D) Credit to raw and in process inventory
Q:
All of the following accounts would be used in a backflush costing system EXCEPT:
A) work in process inventory.
B) finished goods inventory.
C) raw and in process inventory.
D) conversion costs.
Q:
Which of the following pertains to a just-in-time production system?
A) Direct materials and work in process are combined into a conversion inventory account.
B) Direct materials and work in process are combined into a raw and in process inventory account.
C) Work in process and conversion costs are combined into a raw and in process inventory account.
D) Direct materials and conversion costs are combined into a raw and in process inventory account.
Q:
Which of the following is CORRECT about a just-in-time production system?
A) Customer orders drive the production process.
B) Goods are produced ahead of time to protect against running out of inventory.
C) Materials are purchased in large quantities.
D) Inventory levels are maintained at high levels.
Q:
Which of the following pertains to a just-in-time production system?
A) An individual does fewer tasks than under a traditional system.
B) Materials and Work in process are combined into a single account.
C) Units are produced in larger batches than under a traditional system.
D) Direct labor costs are recorded in their own separate account.
Q:
Which of the following pertains to a just-in-time production system?
A) It will have more inventory accounts to track production costs.
B) It will produce goods in smaller batches than a traditional production system.
C) It will require higher inventory levels.
D) It will require longer setup times than a traditional production system.
Q:
Just-in-time systems allow manufacturers to save money on storing, insuring, and financing inventories, by maintaining lower levels of inventory.
Q:
Just-in-time production systems have a great deal of flexibility, and can easily tolerate small interruptions of supplies, and occasional defective materials.
Q:
For just-in-time systems, it is essential that manufacturers develop relationships with suppliers that are very reliable, and that can guarantee quick deliveries of materials in small quantities.
Q:
Just-in-time production gains economic advantage by purchasing inventory in large batches in order to get volume discounts and achieve lower manufacturing costs.
Q:
Just-in-time systems are based on a "demand-pull system" where customer demand triggers the production process.
Q:
The traditional manufacturing process focuses on small batches of production, whereas the just-in-time methodology focuses on large batches of products being produced in a sequence of departments or activities.
Q:
Just-in-time production systems are organized into independent work cells that have all the resources needed to complete the manufacturing process.
Q:
Just-in-time methodology depends on maintaining higher inventory levels to ensure that the manufacturing process isn't interrupted by supply shortages.
Q:
Q:
A-1 Sports Vehicles Manufacturing produces a specialty racing bicycle. There is stiff foreign competition, and the company is forced to pursue target pricing. The competitive market price of the bicycle is $2,000. Currently the manufacturing cost for this product at A-1 is $1,550 and the associated non-manufacturing costs are $270. A-1's owners insist on achieving a profit of 12% of sales price. How much is the desired cost reduction? (Please round all amounts to the nearest whole dollar.)
A) $60
B) $50
C) $40
D) $0
Q:
A-1 Sports Vehicles Manufacturing produces a specialty racing bicycle. There is stiff foreign competition, and the company is forced to pursue target pricing. The competitive market price of the bicycle is $2,000. Currently the manufacturing cost for this product at A-1 is $1,550 and the associated non-manufacturing costs are $270. A-1's owners insist on achieving a profit of 12% of sales price. What amount is the full-product cost? (Please round all amounts to the nearest whole dollar.)
A) $1,820
B) $1,550
C) $2,000
D) $1,760
Q:
A-1 Sports Vehicles Manufacturing produces a specialty racing bicycle. There is stiff foreign competition, and the company is forced to pursue target pricing. The competitive market price of the bicycle is $2,000. Currently the manufacturing cost for this product at A-1 is $1,550 and the associated non-manufacturing costs are $270. A-1's owners insist on achieving a profit of 12% of sales price. What amount is the target cost? (Please round all amounts to the nearest whole dollar.)
A) $1,820
B) $1,550
C) $2,000
D) $1,760
Q:
A-1 Sports Vehicles Manufacturing produces a specialty racing bicycle. There is stiff foreign competition, and the company is forced to pursue target pricing. The competitive market price of the bicycle is $2,000. Currently the manufacturing cost for this product at A-1 is $1,550 and the associated non-manufacturing costs are $270. A-1's owners insist on achieving a profit of 12% of sales price. What amount is the target price? (Please round all amounts to the nearest whole dollar.)
A) $1,820
B) $1,550
C) $2,000
D) $1,760
Q:
Nemesis Company manufactures water skis. Nemesis pursues a target pricing strategy. Please review the data below:
Current market price $180 per pair
Current manufacturing cost $110 per pair
Current non-manufacturing cost $25 per pair
Desired profit 30% of price
Which of the following would be the desired cost reduction? (Please round all amounts to nearest cent.)
A) $12.50
B) $16.00
C) $11.00
D) $9.00
Q:
Nemesis Company manufactures water skis. Nemesis pursues a target pricing strategy. Please review the data below:
Current market price $180 per pair
Current manufacturing cost $110 per pair
Current non-manufacturing cost $25 per pair
Desired profit 30% of price
Which of the following represents the target cost?
A) $126
B) $180
C) $110
D) $135
Q:
Nemesis Company manufactures water skis. Nemesis pursues a target pricing strategy. Please review the data below:
Current market price $180 per pair
Current manufacturing cost $110 per pair
Current non-manufacturing cost $25 per pair
Desired profit 30% of price
Which of the following represents the target price?
A) $143
B) $180
C) $110
D) $135
Q:
Nemesis Company manufactures water skis. Nemesis pursues a target pricing strategy. Please review the data below:
Current market price $180 per pair
Current manufacturing cost $110 per pair
Current non-manufacturing cost $25 per pair
Desired profit 30% of price
Which of the following represents the full-product cost?
A) $143
B) $180
C) $110
D) $135
Q:
Martin Manufacturers produces 3 models of industrial hammers. Martin uses the target pricing approach. The company's objective is to achieve gross profit equal to 40% of selling price. Other data are shown below:
Current production cost $42.50 per unit
Current market price $60.00 per unit
What must the company do to achieve their profit goal? (Please round all amounts to the nearest cent.)
A) Reduce production cost by $6.50 per unit.
B) Increase price by $0.50 per unit.
C) Reduce production cost by $4.20 per unit.
D) Increase price by $6.50.
Q:
Leon Production produces steel rivets for the shipbuilding business. Leon uses the target pricing approach. The company's objective is to achieve gross profit equal to 25% of selling price. Other data are shown below:
Current production cost $112 per carton
Current market price $130 per carton
What must the company do to achieve their profit goal? (Please round all amounts to the nearest cent.)
A) Reduce production cost from $112 to $110.00.
B) Reduce production cost from $112 to $97.50.
C) Reduce production cost from $112 to $101.25.
D) Reduce production cost from $112 to $99.00.
Q:
Appalachee Company produces gaskets for the automotive industry. Current production cost is $3.50 per gross. There is a highly competitive market for the product, and Appalachee currently uses a target pricing approach. Currently, equivalent products are selling for $4.75 per gross. Apalachee wishes to earn a minimum of a 40% markup over cost. What would be their most appropriate response? (Please round all amounts to the nearest cent.)
A) Reduce production cost by $0.11 per gross.
B) Reduce production cost by $0.05 per gross.
C) Increase price to $4.90 per gross.
D) Increase price to $4.85.
Q:
Torreya Company produces gaskets for the automotive industry. Current production cost is $4.50 per carton of 100. There is a highly competitive market for the product, and Torreya currently uses a target pricing approach. Currently, equivalent products are selling for $5.90 per carton. Torreya wishes to earn a minimum of a 30% markup over cost. What would be their most appropriate response?
A) To raise the price to $5.95 per carton
B) To change over to cost plus pricing
C) To mark the price down to $5.80 per carton
D) To stop producing this product because they cannot earn the required amount of profit
Q:
Arnold Company produces handheld calculators, and their manufacturing cost is currently $5.80 per unit. The company also has non-manufacturing costs of $1.20 per unit. Arnold employs target pricing strategy, and the current market price is $8.00 per unit. If Arnold wishes to price their product at a 25% markup over full-product cost, what must they do?
A) Price the product at $8.75 per unit.
B) Reduce full-product cost by $0.20.
C) Reduce full-product cost by $0.60.
D) Reduce the non-manufacturing cost by 25%.
Q:
Bakersfield Manufacturing produces agricultural tools including a hand tiller. Their current full-product cost for a hand tiller is $20. Bakersfield wishes to make a 15% profit on the selling price. Bakersfield uses a target pricing strategy. The current competitive market price for this product is $22.00. What would be the most appropriate response to this situation?
A) Employ cost plus pricing.
B) Carry out value engineering study.
C) Expand production facilities.
D) Strengthen internal controls.
Q:
Bakersfield Manufacturing produces agricultural tools including a hand tiller. Their current full-product cost for a hand tiller is $20. Bakersfield wishes to make a 15% profit on the selling price. Bakersfield uses a target pricing strategy. The current competitive market price for this product is $22. What does Bakersfield have to do to achieve their profit objective?
A) Reduce full-product cost by $1.30.
B) Reduce full-product cost by $3.00.
C) Reduce full-product cost by $2.70.
D) Reduce full-product cost by $11.25.
Q:
Which of the following describes full-product cost?
A) All production costs plus all non-manufacturing costs
B) All production costs
C) Direct materials plus direct labor cost
D) Manufacturing overhead plus non-manufacturing cost
Q:
Ganges Company makes bulk burlap by the ton. Currently, their manufacturing cost is $215 per unit, and their non-manufacturing cost is $40 per unit. The going market price of the product is $300. Ganges uses
the target price and target cost methodology. If they desire to make a profit of 20% on the price, what must they do?
A) Increase the advertising costs by $15 per unit.
B) Reduce the price they charge by $15 per unit.
C) Reduce the full-product cost by $60 per unit.
D) Reduce the full-product cost by $15 per unit.
Q:
What is value engineering?
A) Reevaluating market strategies to create a more valuable product
B) Estimating the value added of the engineering processes
C) Reevaluating production activities to reduce costs
D) Estimating the value of the end product
Q:
Lisbon Manufacturing is considering the manufacture of a new product. Lisbon was hoping to sell the product for $588 per unit and estimated the total cost per unit to be $420. Lisbon conducted market research and found out that the market is only willing to pay $539 for the new product. Using the target costing approach, what does the total per unit cost of the new product have to be if Lisbon wants to achieve a 40% markup on total cost?
A) $215.60
B) $385.00
C) $257.60
D) $420.00
Q:
Percival Company wishes to sell wooden beams to home builders. The current market price of the beams is $950, and Percival knows it must accept the market price. Currently, the beams cost Percival $809 to produce. The company wishes to make a profit equal to 16% of the price. Which of the following strategies would help Percival accomplish their objective?
A) Increase the production cost by $22 per unit.
B) Increase the volume of sales.
C) Increase the sales price to $961.
D) Reduce production costs by $11 per unit.
Q:
Equival Company wishes to sell truck axles to car manufacturers. The current market price of the axles is $400, and Equival knows it must accept the market price. Currently, it costs the company $330 to produce each axle. The company wishes to make a profit equal to 20% of the price. Which of the following strategies should Equival adopt to achieve its objective?
A) Raise the price to $410.
B) Reduce its production costs by $10 per unit.
C) Increase the production costs by $20 per unit.
D) Use advertising to increase the volume of sales.
Q:
Percival Company wishes to sell wooden beams to home builders. The current market price of the beams is $950, and Percival knows it must accept the market price. The company wishes to make a profit equal to 16% of the price. Using target costing, the company will have to design the production process to meet this requirement. What is the desired target cost per beam?
A) $798
B) $1,062
C) $152
D) $800
Q:
Equival Company wishes to sell truck axles to car manufacturers. The current market price of the axles is $400, and Equival knows it must accept the market price. The company wishes to make a profit equal to 20% of the price. Using target costing, Equival will have to design the production process to meet this requirement. What is the desired target cost per axle?
A) $320
B) $480
C) $420
D) $380
Q:
Madrid Manufacturing is considering the manufacture of a new product. Madrid was hoping to sell the product for $504 per unit and estimated the total cost per unit to be $360. Madrid conducted market research and found out that the market is only willing to pay $462 for the new product. Using the target costing approach, how much will Madrid have to reduce the production cost in order to achieve the same amount of gross profit as originally planned?
A) $47
B) $31
C) $30
D) $42
Q:
Rankin Food Products produces cane sugar syrup in bulk quantities and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. Using process costing analysis, Rankin determined that the cost of the units completed and transferred out of the Refining Department during the month was $20,000. Which of the following is the correct journal entry to record the cost of the units completed and transferred out to the next department?
A) Debit $20,000 to Work in process Refining, credit $20,000 to Work in process - Packaging
B) Debit $20,000 to Work in process Refining, credit $20,000 to Work in process - Mixing
C) Debit $20,000 to Work in process Packaging, credit $20,000 to Work in process - Refining
D) Debit $20,000 to Work in process Packaging, credit $20,000 to Finished goods
Q:
LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the Refining Department had 2,000 liters of partially processed product in production. During January, 32,000 liters were transferred in from the Mixing Department and 29,000 liters were completed and transferred out. At the end of the month, there were 5,000 liters of partially processed product remaining in the Refining Department. See additional details below.
Refining Department, beginning balance at January 1, 2012
Quantity: 2,000 units (partially processed)
Cost: $15,600 of costs transferred in
$1,900 of materials cost
$4,500 of conversion cost
$22,000 total account balance
Costs added during January
Cost of units transferred in: $222,400
Direct materials cost $45,000
Conversion cost $93,750
Refining Department, ending balance at January 31, 2012
Quantity: 5,000 units (partially processed)
% completion for materials cost: 90%
% completion for conversion cost: 75%
Please perform a process costing analysis and answer the following question:
For the Refining Department in the month of January, what was the total cost of ending inventory? (Please round to nearest whole dollar.)
A) $35,000
B) $52,550
C) $46,250
D) $33,600
Q:
LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the Refining Department had 2,000 liters of partially processed product in production. During January, 32,000 liters were transferred in from the Mixing Department and 29,000 liters were completed and transferred out. At the end of the month, there were 5,000 liters of partially processed product remaining in the Refining Department. See additional details below.
Refining Department, beginning balance at January 1, 2012
Quantity: 2,000 units (partially processed)
Cost: $15,600 of costs transferred in
$1,900 of materials cost
$4,500 of conversion cost
$22,000 total account balance
Costs added during January
Cost of units transferred in: $222,400
Direct materials cost $45,000
Conversion cost $93,750
Refining Department, ending balance at January 31, 2012
Quantity: 5,000 units (partially processed)
% completion for materials cost: 90%
% completion for conversion cost: 75%
Please perform a process costing analysis and answer the following question:
For the Refining Department in the month of January, what was the total cost of product completed and transferred out? (Please round to nearest whole dollar.)
A) $238,000
B) $383,150
C) $52,550
D) $330,600
Q:
LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the Refining Department had 2,000 liters of partially processed product in production. During January, 32,000 liters were transferred in from the Mixing Department and 29,000 liters were completed and transferred out. At the end of the month, there were 5,000 liters of partially processed product remaining in the Refining Department. See additional details below.
Refining Department, beginning balance at January 1, 2012
Quantity: 2,000 units (partially processed)
Cost: $15,600 of costs transferred in
$1,900 of materials cost
$4,500 of conversion cost
$22,000 total account balance
Costs added during January
Cost of units transferred in: $222,400
Direct materials cost $45,000
Conversion cost $93,750
Refining Department, ending balance at January 31, 2012
Quantity: 5,000 units (partially processed)
% completion for materials cost: 90%
% completion for conversion cost: 75%
Please perform a process costing analysis and answer the following question:
For the Refining Department in the month of January, what was cost per equivalent unit with respect to conversion costs? (Please round to nearest cent.)
A) $1.40
B) $3.00
C) $1.34
D) $2.86
Q:
LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the Refining Department had 2,000 liters of partially processed product in production. During January, 32,000 liters were transferred in from the Mixing Department and 29,000 liters were completed and transferred out. At the end of the month, there were 5,000 liters of partially processed product remaining in the Refining Department. See additional details below.
Refining Department, beginning balance at January 1, 2012
Quantity: 2,000 units (partially processed)
Cost: $15,600 of costs transferred in
$1,900 of materials cost
$4,500 of conversion cost
$22,000 total account balance
Costs added during January
Cost of units transferred in: $222,400
Direct materials cost $45,000
Conversion cost $93,750
Refining Department, ending balance at January 31, 2012
Quantity: 5,000 units (partially processed)
% completion for materials cost: 90%
% completion for conversion cost: 75%
Please perform a process costing analysis and answer the following question:
For the Refining Department in the month of January, what was cost per equivalent unit with respect to direct materials costs? (Please round to nearest cent.)
A) $1.40
B) $3.00
C) $1.34
D) $7.00
Q:
LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the Refining Department had 2,000 liters of partially processed product in production. During January, 32,000 liters were transferred in from the Mixing Department and 29,000 liters were completed and transferred out. At the end of the month, there were 5,000 liters of partially processed product remaining in the Refining Department. See additional details below.
Refining Department, beginning balance at January 1, 2012
Quantity: 2,000 units (partially processed)
Cost: $15,600 of costs transferred in
$1,900 of materials cost
$4,500 of conversion cost
$22,000 total account balance
Costs added during January
Cost of units transferred in: $222,400
Direct materials cost $45,000
Conversion cost $93,750
Refining Department, ending balance at January 31, 2012
Quantity: 5,000 units (partially processed)
% completion for materials cost: 90%
% completion for conversion cost: 75%
Please perform a process costing analysis and answer the following question:
For the Refining Department in the month of January, what was cost per equivalent unit with respect to transferred in costs? (Please round to nearest cent.)
A) $6.54
B) $3.00
C) $1.40
D) $7.00
Q:
LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the Refining Department had 2,000 liters of partially processed product in production. During January, 32,000 liters were transferred in from the Mixing Department and 29,000 liters were completed and transferred out. At the end of the month, there were 5,000 liters of partially processed product remaining in the Refining Department. See additional details below.
Refining Department, beginning balance at January 1, 2012
Quantity: 2,000 units (partially processed)
Cost: $15,600 of costs transferred in
$1,900 of materials cost
$4,500 of conversion cost
$22,000 total account balance
Costs added during January
Cost of units transferred in: $222,400
Direct materials cost $45,000
Conversion cost $93,750
Refining Department, ending balance at January 31, 2012
Quantity: 5,000 units (partially processed)
% completion for materials cost: 90%
% completion for conversion cost: 75%
Please perform a process costing analysis and answer the following question:
For the Refining Department in the month of January, what was the total number of equivalent units with respect to conversion costs?
A) 3,750
B) 32,750
C) 29,000
D) 4,500
Q:
LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the Refining Department had 2,000 liters of partially processed product in production. During January, 32,000 liters were transferred in from the Mixing Department and 29,000 liters were completed and transferred out. At the end of the month, there were 5,000 liters of partially processed product remaining in the Refining Department. See additional details below.
Refining Department, beginning balance at January 1, 2012
Quantity: 2,000 units (partially processed)
Cost: $15,600 of costs transferred in
$1,900 of materials cost
$4,500 of conversion cost
$22,000 total account balance
Costs added during January
Cost of units transferred in: $222,400
Direct materials cost $45,000
Conversion cost $93,750
Refining Department, ending balance at January 31, 2012
Quantity: 5,000 units (partially processed)
% completion for materials cost: 90%
% completion for conversion cost: 75%
Please perform a process costing analysis and answer the following question:
For the Refining Department in the month of January, what was the total number of equivalent units with respect to direct materials costs?
A) 33,500
B) 34,000
C) 29,000
D) 4,500
Q:
LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the Refining Department had 2,000 liters of partially processed product in production. During January, 32,000 liters were transferred in from the Mixing Department and 29,000 liters completed and transferred out. At the end of the month, there were 5,000 liters of partially processed product remaining in the Refining Department. See additional details below.
Refining Department, beginning balance at January 1, 2012
Quantity: 2,000 units (partially processed)
Cost: $15,600 of costs transferred in
$1,900 of materials cost
$4,500 of conversion cost
$22,000 total account balance
Costs added during January
Cost of units transferred in: $222,400
Direct materials cost $45,000
Conversion cost $93,750
Refining Department, ending balance at January 31, 2012
Quantity: 5,000 units (partially processed)
% completion for materials cost: 90%
% completion for conversion cost: 75%
Please perform a process costing analysis and answer the following question:
For the Refining Department in the month of January, what was the total number of equivalent units with respect to transferred in costs?
A) 32,000
B) 34,000
C) 29,000
D) 5,000
Q:
LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the first department, Mixing, had a zero beginning balance. During January, 40,000 liters of chemicals were started into production. During the month, 32,000 liters were completed, and 8,000 remained in process, partially completed. In the Mixing Department, all raw materials are added at the beginning of the production process, and conversion costs are applied evenly through the process.
During January, the Mixing Department incurred $48,000 in direct materials costs and $211,600 in conversion costs. At the end of the month, the ending inventory in the Mixing Department was 60% complete with respect to conversion costs. First, calculate the equivalent units, then calculate the cost per equivalent unit, and then calculate the total cost of the product that was completed and transferred out during January.
The total cost of product transferred out was:
A) $211,600.
B) $48,000.
C) $37,200.
D) $222,400.
Q:
LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the first department, Mixing, had a zero beginning balance. During January, 40,000 liters of chemicals were started into production. During the month, 32,000 liters were completed, and 8,000 remained in process, partially completed. In the Mixing Department, all raw materials are added at the beginning of the production process, and conversion costs are applied evenly through the process.
During January, the Mixing Department incurred $48,000 in direct materials costs and $211,600 in conversion costs. At the end of the month, the ending inventory in the Mixing Department was 60% complete with respect to conversion costs. First, calculate the equivalent units, then calculate the cost per equivalent unit, and then calculate the total cost of the product that was remaining in ending inventory at January 31.
The total cost of product in ending inventory was:
A) $211,600.
B) $48,000.
C) $37,200.
D) $222,400.
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Q:
Rankin Food Products produces cane sugar syrup in bulk quantities, and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. Using process costing analysis, Rankin determined that the cost of the units completed and transferred out of the Mixing Department during the month was $11,000. Which of the following is the correct journal entry to record the cost of the units completed and transferred out to the next department?
A) Debit $11,000 to Finished goods inventory, credit $11,000 to Work in process - Mixing
B) Debit $11,000 to Work in process Refining, credit $11,000 to Work in process - Mixing
C) Debit $11,000 to Work in process Refining, credit $11,000 to Materials inventory
D) Debit $11,000 to Work in process Mixing, credit $11,000 to Work in process - Refining
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Q:
LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the first department, Mixing, had a zero beginning balance. During January, 40,000 liters of chemicals were started into production. During the month, 32,000 liters were completed, and 8,000 remained in process, partially completed. In the Mixing Department, all raw materials are added at the beginning of the production process, and conversion costs are applied evenly through the process.
At the end of the month, LDR calculated equivalent units. The ending inventory in the Mixing Department was 60% complete with respect to conversion costs. With respect to conversion costs, how many equivalent units were calculated for the product that was completed, and how many equivalent units were calculated for the ending balance?
A) 32,000 equivalent units and 4,800 equivalent units
B) 32,000 equivalent units and 8,000 equivalent units
C) 19,200 equivalent units and 4,800 equivalent units
D) 40,000 equivalent units, and 8,000 equivalent units
Q:
LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departmentsue004Mixing, Refining, and Packaging. On January 1, 2012, the first department, Mixing, had a zero beginning balance. During January, 40,000 liters of chemicals were started into production. During the month, 32,000 liters were completed, and 8,000 remained in process, partially completed. In the Mixing Department, all raw materials are added at the beginning of the production process, and conversion costs are applied evenly through the process.
At the end of the month, LDR calculated equivalent units. The ending inventory in the Mixing Department was 60% complete with respect to conversion costs. With respect to direct materials costs, how many equivalent units were calculated for the product that was completed, and how many equivalent units were calculated for the ending balance?
A) 32,000 equivalent units and 4,800 equivalent units
B) 32,000 equivalent units and 8,000 equivalent units
C) 19,200 equivalent units and 4,800 equivalent units
D) 40,000 equivalent units, and 8,000 equivalent units
Q:
Which of the following best describes the term equivalent units?
A) Partially completed units counted in terms of the equivalent number of completed units
B) Partially completed units that will be sold as is
C) Different types of units that can be used for the equivalent purpose or length of time as other units
D) Different products that have the same selling price
Q:
In a process costing system, calculating the cost per unit is used for a number of purposes. Which of the following is NOT one of those purposes?
A) To set selling prices
B) To manage and control administrative expenses
C) To manage and control production costs
D) To calculate the ending work in process inventory
Q:
If there are 500 units in Department 1 Work in process account at the end of the month, and they are 80% complete with respect to conversion costs, they would be accounted for as 400 equivalent units with respect to conversion costs.
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In a process costing system, equivalent units must be calculated separately for materials and conversion costs.
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In a process costing system, direct materials costs are normally assumed to be incurred evenly throughout the production process.
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In a process costing system, conversion costs are normally assumed to be incurred evenly throughout the production process.
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In a process costing system, each department has its own Work in process account.
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Fogelin Promotional Services uses a job order system for costing and billing promotional services for dance and ballet performances. Fogelin has 4 public relations specialists, plus an office staff. At the beginning of 2012, Fogelin estimated the total cost of salaries and benefits for the public relations specialists at $403,200, and a total of 7,200 billable hours for the year. All remaining office and administrative costs were estimated at $676,800.
A new client is contracting with Fogelin to promote a ballet tour in the U.S. Fogelin estimates that the job will require 40 billable hours of specialist time. If Fogelin wishes to make a 25% gross profit on the job, what price should Fogelin quote to the client?
A) $2,800
B) $6,000
C) $7,500
D) $4,700
Q:
Fogelin Promotional Services uses a job order system for costing and billing promotional services for dance and ballet performances. Fogelin has 4 public relations specialists, plus an office staff. At the beginning of 2012, Fogelin estimated the total cost of salaries and benefits for the public relations specialists at $403,200, and a total of 7,200 billable hours for the year. All remaining office and administrative costs were estimated at $676,800.
In June, Fogelin signed a contract for a Russian ballet performance. They negotiated a price of $6,400 for their services. When the job was complete, Fogelin's records showed that they had logged 36.5 billable hours. What was the amount of gross profit that Fogelin made on the job?
A) $1,494
B) $2,969
C) $925
D) $4,356
Q:
Fogelin Promotional Services uses a job order system for costing and billing promotional services for dance and ballet performances. Fogelin has 4 public relations specialists, plus an office staff. At the beginning of 2012, Fogelin estimated the total cost of salaries and benefits for the public relations specialists at $403,200, and a total of 7,200 billable hours for the year. All remaining office and administrative costs were estimated at $676,800.
In June, Fogelin signed a contract for a Russian ballet performance. They negotiated a price of $6,400 for their services. When the job was complete, Fogelin's records showed that they had logged 36.5 billable hours. What was the actual total cost of the job for Fogelin?
A) $5,475
B) $2,044
C) $3,431
D) $4,906
Q:
Fogelin Promotional Services uses a job order system for costing and billing promotional services for dance and ballet performances. Fogelin has 4 public relations specialists, plus an office staff. At the beginning of 2012, Fogelin estimated the total cost of salaries and benefits for the public relations specialists at $403,200, and a total of 7,200 billable hours for the year. All remaining office and administrative costs were estimated at $676,800.
In June, Fogelin signed a contract for a Russian ballet performance. They estimated it would require 34 hours of specialist time. What is the total cost estimate for this contract?
A) $1,904
B) $5,100
C) $3,196
D) $4,906