Acct 505 Mid Term

1. Question (TCO F) Assume there is no beginning effect in surgical procedure blood and the ending work in process inventory is 100% complete with respect to materials cost. The number of tantamount(predicate) units with respect to materials costs under the weighted-average regularity is Student declaration The same as the number of units sit into turnout. 2. Question (TCO F) Process be would be appropriate for each of the following except Student Answer custom furniture manufacturing. 3. Question (TCO F) Which of the following accounts is debit entryed when acquit labor is embarked?Student Answer Work in process 4. Question (TCO F) During December at Ingrim Corporation, $74,000 of blunt materials were requisitioned from the storeroom for use in production. These raw materials included both direct and indirect materials. The indirect materials totaled $6,000. The journal entry to record the requisition from the storeroom would include a Answer debit to Wor k in Process of $68,000. 5. Question (TCO F) Valles Corporation had $22,000 of raw materials on hand on February 1. During the month, the company purchased an additional $75,000 of raw materials.The journal entry to record the purchase of raw materials would include a Answer debit to Raw Materials of $75,000. 6. Question Emerils Utensils has collected the following production selective information for the past quartette months Units produced Total cost7,000 $16,50010,000 22,5008,500 17,7509,000 21,000If the high-low method is used, what is the monthly total cost equation? Student Answer Total cost = $2,500 + ($2. 00 * units produced 1. Question (TCO F) Whether a company uses process cost or job-order costing depends on its industry.A number of companies in different industries are listed below i. Brick manufacturer ii. Contract printer that produces posters, books, and pamphlets to order iii. rude(a) gas production company iv. Dairy farm v. Coal mining company vi. forte coffee roaster (roasts small batches of specialty coffee beans) For each company, indicate whether the company is more or less likely to use job-order costing or process costing. Student Answer 1. Process Costing 2. Job-order costing 3. Process costing 4. job-order costing 5. process costing 6. job order costing teacher Explanation i.Brick manufacturer Process Costing ii. Contract printer that produces posters, books, and pamphlets to order Job Order Costing iii. Natural gas production company Process Costing iv. Dairy farm Process Costing v. Coal mining company Process Costing vi. Specialty coffee roaster (roasts small batches of specialty coffee beans) Job Order Costing Points Received 13 of 15 Comments 2. Question (TCO F) Job 827 was recently completed. The following data have been recorded on its job cost sheet Direct materials $61,050 Direct labor hours 1,332 labor hoursDirect labor wage rate $14 per labor-hour Machine Hours 1,480 machine hours Num ber of units completed 3,700 units The company applies manufacturing operating expense on the basis of machine-hours. The predetermined overhead rate is $13 per machine-hour. Compute the unit product cost that would appear on the job cost sheet for this job. Student Answer Direct material $61,050. 00 Direct labor cost $18,648 ($14 x 1332 hours) Manufacturing overhead $19240 (predetermined over head rate $13x 1480) Total = $98,938/3700 units = $26. 4 unit product cost Instructor Explanation Direct materials $61,050 Direct labor ($14 per DLH, 1,332 DLHs) 18,648 Manufacturing Overhead ($13 per MH, 1,480 MHs) 19,240 Total Cost $98,938 Unit Product Cost $26. 74 Points Received 15 of 15 Comments 3. Question (TCO F) Miller Company manufactures a product for which materials are added at the beginning of the manufacturing process. A review of the companys inventory and cost records for the most recently completed year revealed the following information Units Materials v icissitude Work in process. Jan. 1 (80% complete with respect to conversion costs) 100,000 $100,000 $157,500 Units started into production 500,000 Costs added during the year Materials $650,000 Conversion $997,500 Units completed during the year 450,000 The company uses the weighted-average cost method in its process costing system. The ending inventory is 50% complete with respect to conversion costs. Required i. Compute the equivalent units of production and the cost per equivalent units for materials and for conversion costs. i. Determine the cost transferred to finished goods. iii. Determine the amount of cost that should be assigned to the ending work in process inventory. Student Answer 1. 100,000 + 500,000 = 600,000 x 80% = 480,000 equivalent units of production. 1b Cost per equivalent units Materials = $1. 56 1c conversion cost= $2. 41 2. Cost of transfered goods $748,800 + $1156800. 00 = $1,905,600. 00 3. 100,000 x 80% = 80,000 units $1. 56 40,000 uni ts $2. 41 =96,400 =$221,200 Instructor Explanation Points Received 10 of 15 Comments 4. Question (TCO F) Hunsicker Corporation has provided the following data for the month of January Inventories Beginning Ending Raw materials $30,000 $33,000 Work In process $20,000 $18,000 ruined goods $52,000 $60,000 Additional Information Raw material purchases $63,000 Direct labor costs $92,000 Manufacturing overhead cost incurred $75,000 corroboratory materials included in manufacturing overhead costs incurred $6,000 Manufacturing overhead cost applied to work in process $69,000 Prepare a Schedule of Cost of Goods Manufactured and a Schedule of Cost of Goods change in good form. Student Answer Direct Material Raw Material Inventory, beginning $30,000 add Purchases of raw materials $63,000 Total Raw Material uncommitted $83,000 Deduct Raw Material inventory end $33,000 Raw Material used in production $50,000 Deductindirect Material included in Manufacturin g overhead $6,000 $44,000 Direct Labor $92,000 Manufacturing overhead cost applied to work in process $69,000 Total Manufacturing cost $205,000 Add Beginning work in process $20,000 $225,000 Deduct Ending work in process $18,000 Cost of goods fabricate $207,000 Cost of Goods Sold Finished goods Inventory, Beginning $52,000 Add Cost of goods manufactured $207,000 Cost of goods avaiable for sale $259,000 Deduct Finished goods inventory, ending $60,000 unadjusted cost of goods sold $199,000 Instructor Explanation Hunsicker Corporation Schedule of Cost of Goods Manufactured January xxx Direct materials Raw materials inventory, beginning $30,000 Raw material purchases 63,000 Total raw materials available $93,000 Raw materials inventory, ending 33,000 Raw materials used in production $60,000 Indirect materials included in manufacturing overhead costs incurred 6,000 $54,000 Direct labor 92,000Manufacturing overhead applied to work in p rocess 69,000 Total manufacturing costs $215,000 Beginning work in process inventory 20,000 $235,000 Ending work in process inventory 18,000 Cost of goods manufactured $217,000 Hunsicker Corporation Cost of Goods Sold January XXX Finished goods inventory, beginning $52,000 Add cost of goods manufactured $217,000 Cost of goods available for sale $269,000 Deduct finished goods inventory, ending 60,000 Unadjusted cost of goods sold 209,000 Add Underapplied overhead 6,000 Adjusted cost of goods sold 215,000