Acct 504 Quiz 4
(1) Which of the following statement (s) is/are true?
[pic]A)[pic]A manufacturer of paper would ordinarily use process costing rather than job-order costing.
[pic]B)[pic]If a company uses a process costing system it accumulates costs by processing department rather than by job.
[pic]C)[pic]The output of a processing department must be homogeneous in order to use process costing.
[pic]D)[pic]All of the above are true statements.
Feedback:
The correct answer is D (Learning Objective 1):
A process costing system is used in situations where the company produces many units of a single product for long periods, such as the manufacture of paper (thus statements A and C are true). When a process costing system is in use, costs are accumulated by department and assigned uniformly to all units …show more content…
The following information was available for one of its processing departments: • The beginning work in process inventory consisted of 16,000 units, which were 75% complete with respect to conversion costs. • The department converted the equivalent of 59,000 units of production during the current month. • A total of 50,000 units were completed and transferred out of that department during the current month. • The ending work in process inventory consisted of 12,000 units, which were 50% complete with respect to conversion costs.
The number of units started during the month in that department was: [pic]A)[pic] 29,000 units. [pic]B)[pic] 42,000 units. [pic]C)[pic] 46,000 units. [pic]D)[pic] 54,000 units.
Feedback:
The correct answer is C (Learning Objective 2):
To determine the units started during the current month, account for all units in the processing department as
[pic]A)[pic]A manufacturer of paper would ordinarily use process costing rather than job-order costing.
[pic]B)[pic]If a company uses a process costing system it accumulates costs by processing department rather than by job.
[pic]C)[pic]The output of a processing department must be homogeneous in order to use process costing.
[pic]D)[pic]All of the above are true statements.
Feedback:
The correct answer is D (Learning Objective 1):
A process costing system is used in situations where the company produces many units of a single product for long periods, such as the manufacture of paper (thus statements A and C are true). When a process costing system is in use, costs are accumulated by department and assigned uniformly to all units …show more content…
The following information was available for one of its processing departments: • The beginning work in process inventory consisted of 16,000 units, which were 75% complete with respect to conversion costs. • The department converted the equivalent of 59,000 units of production during the current month. • A total of 50,000 units were completed and transferred out of that department during the current month. • The ending work in process inventory consisted of 12,000 units, which were 50% complete with respect to conversion costs.
The number of units started during the month in that department was: [pic]A)[pic] 29,000 units. [pic]B)[pic] 42,000 units. [pic]C)[pic] 46,000 units. [pic]D)[pic] 54,000 units.
Feedback:
The correct answer is C (Learning Objective 2):
To determine the units started during the current month, account for all units in the processing department as