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Exam 4: Systems Design: Process Costing

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Question 51

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(Appendix 4B)In both the direct and step-down methods of allocating service department costs,any amount of the allocation base that is attributable to the service department whose cost is being allocated is ignored.

A) True
B) False

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Question 52

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(Appendix 4A) Qart Company uses the FIFO method in its process costing system.Operating data for the Cutting Department for the month of March appear below: According to the company's records,the conversion cost in beginning work-in-process inventory was $1,656 at the beginning of March.Additional conversion costs of $129,960 were incurred in the department during the month. What would be the cost per equivalent unit for conversion costs for March on the Cutting Department's production report? (Round off to three decimal places.)

A) $1.710.
B) $1.677.
C) $1.756.
D) $1.840.

E) A) and C)
F) B) and C)

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Question 53

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(Appendix 4A)Easy Inc.uses the FIFO method in its process costing system.The following data concern the operations of the company's first processing department for a recent month: Required: Using the FIFO method: a) Determine the equivalent units of production for materials and conversion costs. b) Determine the cost per equivalent unit for materials and conversion costs. c) Determine the cost of units transferred out of the department during the month. d) Determine the cost of ending work-in-process inventory in the department.

(Appendix 4A) Assuming that Cherrington Company uses the FIFO method,what is the cost per equivalent unit for conversion costs for May,rounded to the nearest cent?

(Appendix 4A) Mukluk Company uses the FIFO method in its process costing system.The conversion cost for the month of April is $5.00 per equivalent unit,and the materials cost is $2.90 per equivalent unit.At the beginning of the month,1,000 units were in process,and 100% were complete with respect to materials and 30% were complete with respect to conversion,with a total cost at that point of $2,400.If these units are fully complete by the end of the month,what will be their total cost?

(Appendix 4B)Hancock Company has two Service Departments-Factory Administration and Maintenance-and two Producing Departments.Selected information relating to these departments follow: The company allocates Service Department costs using the step-down method. Costs of Factory Administration are allocated on the basis of the number of employees. Costs of Maintenance are allocated on the basis of labour hours. Allocation begins with the Factory Administration Department. Required: Prepare a schedule showing the allocation of Service Department costs to the other departments.

What are the equivalent units of production for labour and overhead for the month of May?

What are the equivalent units of production for material for the month?

(Appendix 4A) Assuming that Tru-Colour Paint Company uses the FIFO method,what are the equivalent units of production for materials?

(Appendix 4A) Using the FIFO method,what are the equivalent units of production for conversion for March?

(Appendix 4B) Which of the following statements about the step-down method of allocating service department is correct?

Using the weighted-average method,what are the equivalent units of production for material for the month?

Suppose the company used the weighted-average method.What amount would have been credited to the Work-in-process inventory for the units completed and transferred out during the month of May?

(Appendix 4B) What allocation method recognizes that service departments often provide each other with interdepartmental services,and it is therefore considered to be the most accurate method for allocating service department costs to operating departments?

Miller Company manufactures a product for which materials are added at the beginning of the manufacturing process.A review of the company's inventory and cost records for the most recently completed year revealed the following information: The company uses the weighted-average method in its process costing system. The ending inventory is 50% complete with respect to conversion costs. Required: a) Compute the equivalent units of production and the cost per equivalent units for materials and for conversion costs. b) Determine the cost transferred to finished goods. c) Determine the amount of cost that should be assigned to the ending work-in-process inventory.

(Appendix 4B)Flinders Company has two Service Departments-Factory Administration and Maintenance-and two Operating Departments.Selected information relating to these departments is given below: The company allocates Service Department costs by the step-down method. Factory Administration costs are allocated first on the basis of number of employees, and then Maintenance costs are allocated on the basis of total labour hours. Required: Prepare a schedule showing the allocation of Service Department costs to other departments.

Harmon Company uses the weighted-average method in its process costing system.The Curing Department of Harmon Company reported the following information for the month of November: All materials are added at the beginning of the process. Required: Compute the following items for the company's monthly production report using the weighted-average method: a) The equivalent units (EUs) of production for materials. b) The cost per equivalent unit for conversion. c) The total cost assigned to units transferred out of the Curing Department during November. d) The cost assigned to work-in-process inventory as of November 30.

Assuming that the company uses the weighted-average method,what is the cost per equivalent unit for conversion costs for June,rounded to the nearest cent?

(Appendix 4A) All production costs have been steadily rising in the Donner Company for several periods,and the company maintains large work-in-process inventories.What is the Donner Company's cost per equivalent unit,as computed using the FIFO method?

What was the total cost of the October 31 work-in-process inventory?