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Accounting 2 - Chapter 16 Multiple Choice
Terms in this set (10)
After posting all actual factory overhead and applying factory overhead to production departments in a process costing system:
There may be over or underapplied overhead.
During the current period, Department A finished and transferred 50,000 units to Department B. Of the 50,000 units, 20,000 were one-fifth complete at the beginning of the period and 30,000 were started and completed during the period. Also during the period, 10,000 units were started but brought only to a stage of being three-fifths completed. Beginning goods in process inventory overhead costs were $6,000. If the weighted-average method is used and $14,000 of overhead was charged to Department A during the period, how much overhead should be allocated to the ending goods in process inventory?
EU = 50,000 + (10,000 x .6) = 56,000
EU in ending inventory = (10,000 x .6) = 6,000
Overhead allocated to ending inventory: (6,000/56,000) x ($14,000 + 6,000) = $2,143
Direct labor and indirect labor are recorded, respectively, to:
Goods in Process and Factory Overhead.
A department had 65 units which were 20% complete in beginning Goods in Process Inventory. During the current period, 77 units were transferred out. Ending Goods in Process Inventory was 30 units which were 20% complete. Using the weighted-average method, what are the equivalent units produced if all direct material and direct labor are added uniformly throughout the process?
77 + (30 x .2) = 83
A department had 12,500 units that were 20% complete in beginning Goods in Process Inventory. During the current period 60,000 units were transferred in. Ending Goods in Process Inventory was 15,000 units that were 70% complete. Assume this company uses the weighted-average method of process costing and direct material is added uniformly throughout the process. What are the equivalent units produced with respect to direct material?
Units Completed and Transferred Out = Beginning Inventory + Units Transferred In - Ending Inventory.
Units Completed and Transferred Out = 12,500 + 60,000 - 15,000 = 57,500
Equivalent Units = 57,500 + (15,000)(.7) = 68,000
Which of the following five types of products is least likely to be produced in a process manufacturing system?
Slacks for casual wear.
An expression of the activity of a process as the number of units that would have been processed during a period if all effort had been applied to units that were started and finished during the period is called:
Equivalent units of production.
A system of accounting in which the costs of each process are accumulated separately and then assigned to the units of product that passed through the process is a:
Process cost accounting system.
The purchase of raw materials on account in a process costing system is recorded with a:
Debit to Raw Materials Inventory and a credit to Accounts Payable.
The Filtering Department started the current month with beginning goods in process inventory of $55,000. During the month, it was assigned the following costs: direct materials, $77,000; direct labor, $44,000; and factory overhead, 20% of direct material cost. Also, inventory with a cost of $66,000 was transferred out of the department to the next phase in the process. The ending balance of the Goods in Process Inventory account for the Filtering Department is:
$55,000 + $77,000 + $44,000 + $15,400 - $66,000 = $125,400
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