MULTIPLE CHOICE QUESTIONS 1. Departmen Il of Charity Manufacturing Company presents the following Production data for the month of May, 2011 " Opening inventory, 3/8 completed...... 4,000 units Started in proc pores 13,000 units Transferred ..... pees 9.000 units Closing inventory, 1/2 completed. 4.000 units 3/4 completed. 4,000 units What are the equivalent units of production for the month of May, 2011 FIFO Method = Average Method FIFO Method — Average Method a. 12,500units 13,000 units c. 12,500 units 14,000 units b. 17,000units 12,500 units d. 15,000 units 14,000 units (PhilCPa} 2. Waiden Company has a Process Cost system. All materials are introduced at the beginning of the process in Department One. The following information is available for the month of January 2011: Work-in-process, 1/1/2011 {40% complete as to conversion costs) .. 500 Started in January .... 2.000 Transterred to Department Two during January 2,100 Work-in-process, !/31/2011 (25% compiete as to conversion costs) .... 400 Whot are the equivalent units of production for the month of January 2012? : FIFO Average Materials Conversion Jaterials Conversion a. 2,500 2,200 2,000 2,000 b. 2,500 1,900 2,500 1,900 c. 2,000 2.200 2,000 2.200 d. 2,000 2,000 2.500 2.200 (AICPA)r sith : firsiist ' st stage oO 5 the fir 9 Mann Company. tAis ater inform ation is available for conver. pod sehen rit ot ne -ess. beginning (60% Completey Ww se na en Ap Stil and transferred to de . . and process: vending (40% complete) Partinent 8 nr, ry "ale! ynits for the conversion Cost Catculation ore wre noe Average FIFO Average © 324,000 324,900 a. 336000 J2a000 Na 336,000 d. 324000 334000 ada: ate inf Work-in-Process, (60% comple started iri Agri. Completed Work-in-process, April 30 (75% cornpiete as to conversion COSt) wens 3,000 rol are the equivalent units of production for the monin of Ap@il? Average _ Maierials Conversion 28,000 28,000 26,000 26,000 20,000 26,000 ey 50.000 26,000 . (Adapted) formation per Aprit D te as to conversion cost) or 0K 6 0 AICPA 5 materials at the end of the process in Department riain to Department M's work-in-process dunn g a928. Nery ration's production cycle starts in the Mixing De, ‘ feng Rtermation is available for April; Portman, 1 Units WIP, April 1 (50% complete} oo Started in April..... 20g WIP, April 30 (60% complete) ad ded at 55% stage of completion in the Mixit Wet ere he aquvoient units of production for the month or seamen FIFO. Average Materials Conversion — Conversion 230,000 250,000 280, 270,000 5. 250000 280,000 270,000 280,000 c. 280.000 280,000 280,000 280,900 d. 270.000 270,000 270,000 2701000 . On September 30, work-in-process totaled 9,000 units 60% Complete (baseg corwersion costs added uniformly throughout the trond motecy Odded at the start of the process). A total of 100,000 units were transfered to he nex! department during October. On October 31, fotal of 8,000 units a complete (based on conversion cosis) were stil in Process in Department A, Using the weighted-dverage cost flow method, which of the fotlowing equivalent units should be used in the calculation of costs for October? Equivalent: Units Transfer Costs — Materials Conversion ec. 108,000 100,000 103,200 b. 108,000 100,000 100,000. c. 108,000 108,000 103,200 d. 109,000 101,000 104,200 (cw) + BWIP was 60% complete as to conversion costs, and EWIP was 45% corer Qs to Conversion costs, The P2850 amount of the conversion cost inc! ' EWIP (using the weighted aveage method} is determined by mnutiohng oe average unit conversion costs by what percentage of the totatunits a. 100% c. 55% b. 0% d 4% (acralpsi aa ___929 i ing data refer to the units 9 Processed by t a 7 0 et month. ¥ the grinding deparimens bor * for sani k-in-process inning worl ; Bens started. Ei 92000 units complete: Sees 700,000 ending work-in-proc 72.000 peginning work-in-process was 60% complete, iver the ending work. myocess is 70% complete. What are the equivalent unitscr ring w or on’ for the ™ FIFO. Average FIFO Average 206,000 198,800 c. 206000. 206.000 b. 198,800 206,000 d. 198,800 198,800 (Cla) . With the following data for a company using the FI IFO process cost system, calculate the equivalent units for materials and conversion costs: Percert Complete Whole Conversion Units Materials Costs Beginning inventory . 10 100% 30% Tronsferred in fa Transferred out . Ending inventory .. 30 100% 40% 89 materials, 100 conversion costs 100 materials, 89 conversion costs '10 materials, 99 conversion costs 130 materials. 199 conversion costs anga (Cla) ° A company ss Cost system, CUPS fOduces plastic drinking cups and uses a proce: ae © Hough three deperimenis~ mixing, molding. and package ent. * ‘onth Of June the following intormation is known about wing ‘a 10,000 aay Orkin - 4 complete : “Process at June | An average ot nits rts .000 units Works ‘Omplete during June 20 "process at June 30... if An average 1/4 complete 4/ ‘ a oO - Chair 1g Materials are added al two points in the process; Materials 4 js Odde., the beginning of the process and Material B at the Midpoint of th re at process. Conversion Costs are incurred uniformly throughout the re process. Under a FIFO costing flow, the equivalent units for Materas Material B, and conversion costs respectively for the Month of aA (assuming no spoilage) would be. a. 150,000; 130,000; and 137,500 c. 160,000; 130,000: ang : 5.0 180,000; 140.000; and 135,000 d. 160,000; 140.000: ang 125 a (Clay 11. Glo Co. a manufacturer of combs, budgeted sales of 125,000 units for the onth of April. The following additional information is Provided: - Number Of units Actual inventory at April 1 —— Work-in-process . None Finished goods 37,500 Budgeted inventory at April 30 Work-in-process (75% processed) 8,000 Finished goods... 30,000 How many equivalent units of Production did Glo budget for April? a. 126,500 c. 123,500 b. 125,500 d. 117,500 (AICPA) 12. Bronson Company, which had 6,000 units in work-in-process at January | that were 60% complete as to conversion Costs. During January 20.000 units were completed. At January 31, 8,000 units remained in WIP which were 40% complete as to conversion costs. Materials are added at the beginr int of the process. Using the weighted average method, the equivalent units for January iC conversion costs were: a. 19,600 } 23,200 b. 22,400 d. 25,600 laicraly 98 (ostit$——— oe __$i - sre same information at No. 12, how many units were started during sd ve on 18,000 ic 20,000 19,600 d. 22,000 (AICPA) co. had 3,000 units in work-in-process at April | which were 40% XeW Fete os fo conversion Cost. During Apiil, 10,000 units were completed ome 1 30. 4,000 units remained in work-in-process which were 40% anrele as to conversion cost. Direct materials are added at the peginning of the process. How many units were stared during April2 9,000 c. 10,000 b. 9.800 d. 11,000 (AICPA) « fed Finished goods - 1,300 units ° Using FIFO meth i ailie 10d, the value of Process C inventory in process for Octobe! a. P4,200 ! b. 3.500 S P5,400 . 2,400 (PhilCPA)«cost 943 pet _ |, Information conceming Department 8 of simon Co. is as follows ® ; 7 Trans- _ Mate- Conver- Total ; Lnits Cost ferin rials sion Cost gee Son Pp fx P 2.900 P P 3,400 P 6,300 Uni RE 38.000 17,500 25,500 15,000 58,000 40,000 P64,300 py units completed... 37,009 === (22400 P25.500 P1840 P64.300 4l. Endg. work in process 3,000 Conversion costs were 20% complete Qs to the beginning work in process and 40% complete as to the ending workin process. All materials are added at the end of the process. Simon Co. uses the weighted average method. The portion of the total cost J i of ending work-in-process attributable to transferred-in cost is: a. P -O- Cc. P1,530 b. 1,500 d. 1,650 (PhilCPA) E. John Company uses process cost system with average costing to account for the production of its only product. The product is manufactured in two departments. Units are started then transferred to the Finishing Department, where they are completed. Units are inspected at the end of the Production Process in the Forming Department, and the cost of abnormal lost is charged to Factory Overhead Control account or abnormal spoilage expense depending on management prerogative. Data related to August operations in the Forming Department are: Units in beginning inventory (60% materials, 35% labor, and 25% overhead) ( Units started in process this period. — Units andened to the Finishing Department this period 8,000 Units in ending inventory (100% materials. 75% labor, and 50% overhead) .....944 Ltapter ig Beginning Addeg Inventory this periog — P1,260 P36,240 770 10.780 1,400 2178 Total costs transferred to Finishing Department: 52 c. P59,452 . "5200 d. 58000 or less (Adapteg) 42. Elsa, Inc. instituted a new process in October. During this month, 20, units were started in Department A. Of the units started, 2,000 were lost in the process, 14,000 units were transferred to Department B, and 4, remained in work in process at October 31. The work in process at October 31 was 100% complete as to material costs and 50% complete 5 to conversioh costs. Material costs of P54,000 and conversion costs of 80,000 was charged to Department A in October. What were the total Costs transferred to Department B? a. P 93,800 c. P105,000 b. 112,000 d. 114,200 (PhilCPa) 43. For the month of May, 2011, the Finishing Dept. of Apple, Inc. had in opening work in process 80% complete units and in ending work in process 50% complete units. Related data for the month follow: Units Conversion Cost Work in process, May 1... 50,000 P 88,000 Units started, and costs incurted during May 270,000 572,000 Units completed and transferred during May 200,000 If the company uses first-in, first-out costing, the conversion cost of the work in process at the end of May would be: a.” P132,000 c. P176,000 b. 156,000 d. 254,000 (Adapted)> a 945 £ e plant manager of Arena Produ: cts Co. gathered roduction statistics r ia ‘October, 2008 as follows: ° 7 ‘ work in process, opening: 8,009 units (all matevials but only 1/2 Converted): materials cost, P7 968; labor ; Gnd overhead cost, P8,592 Placedin process, Oct: 40,000 units: materials Cost, P48,000: labor and overhead cost, P79,872 Completed and transferred fo stock during Oct.: 42,000 units Work in process, Closing: 6,000 units (all materials but only 3/5 converted) The cost of the completed units would be: FIFO Average FIFO Average a. P130,452 P130,320 Cc. P130,452 P130,452 b. 130,320 130,452 d. 130,320 130,320 (Adapted) . Maurice Company adds materials at the beginning of the process in the Forming Department, which is the first of two stages of its production cyc Information concerning the materials used in the Forming Departmen! April is as follows: Units Materials Cosis WIP, April 1. 12,000 P 6,000 Units started 100,000 51.120 Units completed and transferred to next department...... 88,000 Using the weighted average method, what was the materials cost of WiP at April 302 a. P6120 c. 12000 ©. 11040 dg. 12240 AICPA 4, During March, Bly Company's Departnien'Y cayivalen! rity uct cost Computed under the weighted average method. were o Materidls...... Conversion Transterred-in~ 6 Materials are introduced a! the end of tne process in Departmen, 1Y the, were 4.000 units (40% complete as 'o conversion cos!) in WIP at ney The total costs assiqned to the March 31 WIP inventory should be Hen P27 4B a. P36,000 c. b. 28.800 4 (Alcea i of January concerning Department a, 47. Information tor the month of cs ) the fe stage of Ogden Corporation's produc'ion cycle, is as follows: firs Materials Conversion P 8,000 P 6,000 BWIP ... ss 7 40,000 Current costs 32.000 Total costs ... P_ 48,000 P38.000 Equivalent units using weightec average method ....... 95,000 Average unit costs .... P 0.40 Goods completed * 90,000 units EWPP ..... 10,000 units Materials are added at the beginning of the process. The ending work-in- process is 50% complete as to conversion costs. How would the total costs accounted for be distributed, using the weighted average method? Goods — Ending Work- Goods _ Ending Work- Completed — In-Process Completed _ in-Process a. P79,200 P6,800 c. — P86,000 age) b. P79,200 P8,800 d. —P88,000 P6,800 (AICPA) 3. Following data for September were taken from the cost records of the Mixing Department, Fair Manufacturing Company which uses the average costing method: Work in process, August 31 (All material, 50% converted) 1,000 units Put into process during the month 10,000 units Work in process, September 30 7 (All material, 60% converted) 1,400 units ae947 costs. rk iN process, August 3): . wor Material co / P24,000 Labor mo aS 15,000 Factory overhead ean . 7,600 st into process during the Month * Material ; . . P251,000 Labor ......, bo 193.800 Factory overhead 149.000 the total Cost of the units SOMPIeted ond transferred to the next department was: 2. 576,000 ©. P6ay.409 b. 605,400 693,800 (PhiicP A Using the same information i IN No. 48, Compute the tota) Cost of ‘Nn POCess On September 30 was: the work- Gg. — P29,400 Cc. P 64,400 b. 46,600 d. 103,809 (PhilCP A) 30. You are engaged in th ' Audit of the December 3} financial statements of Orporation, o Manufacturer Of digital Watches. You are attempting 1o verify the Costing of the EWIP and finisheg 90ods which were record, On Spirit's books as follows: Spirit C WIP (50% complete as to labor and overhead) 300, 000 P 6% Finished goods .., . issocee ~ 200.000 1 d00 Materials are adde: Process, ang Overhead is ay direct labor Costs. || feview of Spirit’ siny, dto Production at the beginning of the manuf, Pplied to each Product at the rate ¢ . here was no finished goods inventory on January \ ‘entory cost records disclosed the following ir Cosis {in th Units WIP, 1/1 complete as ; . to tebe oo srairecen : oh Units Started in Production ( o Material costs .. . Labor costs... . 900 Units completed z| = era hep The equivalent units for labor: ~ Average PFO Average a 890,000 ©. 890,000 O5q50~ b. 1,050,000 1,050,000 d. 890,000 85000 "Addapte 51. Using the same information in No. 50, what is the total cost for + vethe, 1c FIFO Average FIFO Average @.P1,197,000 1,386,000 ¢.P1,197,000 P-1.97,099 b. 1,386,000 1,197,000 . 1,386,000 1,386,005 (Adapte 52. Using the same information in No. 50, what is the cost per Equivalent y for labor? FIFO Average FIFO. Average a. P2.20 P2.24 c. P2.20 P2.20 b. 2.24 2.20 d. 2.24 2.24 (Adapte. 53. Using the same information in No. 50, what is the’ total cost for the engi inventory of finished goods using the weighted average method? a. P869,000 c. P900,000 b. 954,000 d. 786,000 (AICF 54. Samahan, Inc. manufactures a highly sensitive smoke alarm. The Company uses the FIFO method for process costing and for costi: goods sold. In costing finished goods, the unit Cost for units complet from work in process inventory at the beginning is kept separate from ti unit Cost of smoke alarm started and completed during the month. The total manufacturing costs for the month of June is P264,000 and 2,7 units are completed during the month. The inventories at the beginning June are as follows: Smoke alarm in process (estimated 80% completed) ... Smoke alarm on hand (completed) . its 128,000 1,250 units 76800 600 units_ 94 aventories at the end of June are: tre" smoke alarms in process (50% Complete) smoke alarms on hand (complete) sotoesesasen n compute the cost assigned to: work-in-Process, Finished Work-in-Pro se a End Goods, End 5 é ———_—___ —— ae = a ‘a. P33,000 P79,200 ©. P33,200 b. 33,000 92,400 64.406 5, Borkey Company adds ™aterials at the beginning of the Process in D: N.Data conceming the materials used in March 2011 Produc tion ore Work-in-process at March 1 16.00 Started during March... see 34,006 Completed and transfered to next department during March 36,00¢ Normal spoilage incurred. 4,000 Work-in-process at March 31 . 10,00¢ The equivalent units for the materials unit cost calculation are: FIFO Average FIFO Average a. 46,000 30,000 c. 46,000 46,000 b. 30,000 46,000 d. 30,000 30,000 (AICPA 56 Materials are Added at the start of the process in Cedar Company Blending department, the first stage of the production cycle’ The following information is available for July: Units Work-in-process, July | (60% complete 60,000 Qs to conversion costs) .. . 150,000 Started in July .. oS 110,000. Fansterred to the next department ... 30.000 Lost in production .... Work-in-process, July 31 (50% complete / 70,000 Qs to conversion costs) ..950 eer, 7 i tem, the costs incurreg on ost accounting sys! . e | under Cede’ Oe aining good units. What are the evivaten! Units are absorb: unit cost calculation? t Units for the Ma’ fro Average FIFO Average ——= to000 c. 180,000 3190 20,000 120,000 9,009 ei s coo 180,000 d. 140,000 210,009 (Alcp, A) information in No. 56, what are the equivalent unit: Sr Se cost unit calculation? $FoF the FIFO Average FIFO Average o. 145000 109,000 c. 139.000 175 g65 b. 109,000 145,000 d. 109,000 175,000 (Adapteg) Cc ny Manufactures compact disks. In June 2011, Producti 6 oar One Aere started. At the end of the month, the following cen were gathered: Completed units Defective units .. in process, 1/2 complete ... How many units were in process at the beginning of the monthe a. 1,500,000 c. 2,000,000 b. 2,300,000 d. 1,900,000 (Adapted) 5%. Ablan Co. produces a special kind of insecticides. Materials are added at the end of production of Mixing Department. For the month of March, 2011, the following data were gathered: No. of Units Work-in-process March 1, 40% complete as to conversion costs... ee sete oO Started in process during the month... is Transferred to the Molding Departmen Hae) Lost units in Processing .... . Work-in-process, March 31, 60% compl te as to conversion Costs tase : coor = Aenccnuaenanniin a1 i. Ce ne costs corresponding fo the lost Units Were Absorbed f what are the equivalent units for the Materials unit co FIFO Average ee FIFO Ave a. 130,000 130,000 io 140,000 140 b. 85000 85.000 d. 85000 KC , using the same information in No. 59, what Ge the equivalent units for tr * conversion Costs Calculation? FIFO. Average ena ast FIFO Average o. 96000 112,000 ©. 112000 96.000 p. 96000 96,000 4. 105,000 122.000 {Adapted 41, Dex Co. had the following Production for the month of June. Units Work-in-process at June’! 10,000 Started during June .. 40,000 Completed and transferred to finis 33,000 Abnormal spoilage incurred 2,000 Work-in-process at June 30. 15,000 Materials are added at the beginning of the Process. As to conversion cost, the beginning work-in-process was 70% completed and the ending work-in-process was 60% completed. Spollageis detected jat the end of the process. The equivalent nits for June, with respect to conversion costs, were as follows: FIFO Average FO Average a. 44 44,000 c. 44000 37,000 b. eco 42,000 d. 37,000 44,000 (AICPA) cl through a continue 2. Basic Chemical Industries, Inc. produces a product ne ye Sue Process in different departments. Each department has i" eeeeal Cost accountant who is tasked with cumulating costs me ea oe Of reports for the department assigned fo him. You have be COst accountant for Deparment Aa 982 a of DPA Men, A for Len, neve os ‘he month of Septer wy were as fo! len i or 1} wou noe oc Cars — Percentac® 7 started in proe eet emg vn ; . Work in DFO Scone ction : = centage of CO = io units inomall © Nd of Process. aa kg 2600 ost6 Ore Qn. In this department cos! opplieg ostolon, Materials - added ot Stary, Labor and ovemMe" = SVEN distriguteg, Department costs incurred in September were: Materials Labor Overhead in process cost, Sept ember | Work in pr . Compute the curent fofel Unit for materials, labor, and overheag a. 1.23 smn b. 1.04 gry (PhilCPa) 63. Using the same datain No. 62, compute the adjustment for nomial Pre a. P.0368 = pon — d. 0357 (Adapteg) 64. Using the same information in No. 62, what is the cost of the: Work-in-process Units transtereg Roe berad Units ranstered September’ a. P82,390 mad b. 81.890 oe 4 oa 12,840 | ° ae 12,840COS oe - _ 953 oe son Company Hates three producing deparlments~ Cutting Sewing ond Fishing Fs Teary. Sewing Depariment transterred 6,200 units to (i vrtment ee oS 400 units proces ct nays the month wing Deporimen! Wotkin-process invertoties as of January 31, were 1.200 units. These Units Were still (1/4) pre-loutth incomplete as of thal date. with cost of P13.312. The units Started in Sewing Department in February were received from the preceeding department at a cost of P47 59% 40 puting February, Sewing Department incurred the following costs TH ils . Molercls P11,772.00 . 15,660.00 Factory overhead . 2,268.00 As of February 28, Sewin, 19 Department h, required to complete th, 'as done one quarter of the work © Process invent lories. Compute the cost of the: ; Work-in-process Units transferred February 28 —___** ss P86,532.00 84,882.00 71,750.00 86,532.00 aogo (PhiCP A) 66. The Maginoo Company manufactur @5 a single product in a continuc Process in two departments, Cost and production Statistics for the month of March, 201 | are snc Dwr below: . Assembling Finishing Costs Department Department Py 5 P18.00¢ Work in process, March | ven Materials........ 47,250 85,800 Labor ........ 31,500 47.200 Factory overheada, | ee ity: Guo in process, March | (ali materials: half-converted) ..... aon Units started in process ..... . a Baan a Units received from preceding department a Units completed and transferred ng 2005 Units in process. March 31 25 {All materials: 60% converted) So - Lost during the process pond ton Compute the total costs transferred: Assembing Finishing ot ng Finis Sapo Deparment Department Deptt 2 P1500 -F250000c.P135000 Pagan b 152500 = 286,000. —«4421,500 23800 (PhilCe 67. Tiger Mig. Co. makes a single product in two departments, The Productio, data for Dept. 2 for May 2011 follows: Quantities: In process, May | (40% done) 4,000 units Received from Dept. 1... 39,900 units Completed and transferred. 25.000 units In process, May 31 (60% done) . 6,000 units Production Costs: May! May31 ° Transferred in P16,300 —P89.100 Materials... 3,800 67,500 Conversion cost .... 1,940 81,000 Materials are added at the start of the process, and losses normally occur during the early stages of the operation. Compute the: (1) cost of the ending work-in process inventory using average Costing, and (2) the cost of goods manufactured using FIFO method: a. (1) P44,640; (2) P195,250 c. (1) P45.600: (2) P193,040 b. (1) P44,640; (2) P214,080 d. (1) P46,800: (2) P214,080° ee 955 given fora certain process: ; Beginning work in process, 2/5 ronsferredin ... Completed ........... 500 units Normal spoilage. 2,000. units Aonormal spoilage ” units Goods completed and transfe units ° 5 Ted 0 ee Ending work 1 process, 1/3 compl aa d m units Conversion costs in beginning inventory P610 ae Current period conversion costs... P3,990 Al spoilage occurs at the end of the Process. The conversion Cost per equivalent unit amounted to: FIFO Method Average method a. -PL90 baa b. 2.19 200 c. 2.00 1.90 d. 1.90 2.00 (Adapted) 49. Using the same information in No. 68, the conversion costs componenis of normal spoilage: FIFO ~ Average FIFO Average a. P438 P400 Cc. P400 P380 b. 380 3b d. 380 400 (Adaptec 70. Using the same information in No: 66 the conversion costs components o abnormal spoilage: FIFO | Average FIFO Average : ——_ P570. a. 570 P5l? 0 b. 657 cd (Adiay956 7. production process in which all material is added at Production. Company management has speciiicg cite cannot exceed 7 percent of the units started in | NO the happens during the production while abnormal cf". Nor the end. March processing information follows "98 discovers, Tornado Electronics uses « weighted average procs ¢¢, : 8 Costin the Beginning inventory (10% complete — Conversion) y MM, Started during March....... Completed during March .. Ending inventory (60% complete — conversi The equivalent units of production for materials ANd conversion Cost: —__ FIFO Average Materials Conv. Cost Materials ~~ Conv Coy 2. 60,000 62,300 67,000 soma b. 55,800 58,100 62.800 eee c. 55,000 57,300 62,000 58,000 d. 62800 58,800 55,800 58,100 (Adapted) or less of gallons of material Placed into production. The folio, jing . statistics are available for September 2011 for the chemical yzP. 2 °Peatng Beginning inventory (20% complete as to material; 30% complete as to conversion) 8,000 gallons Started during September .. 180,000 gallons Ending inventory (60% complete as to material: 70% complete as to conversion). . 4,000 gallons 1,400 gallons Spoiled... The equivalent units of production for materials and conversion cost: FIFO Average Materials Conv. Cost Materials Conv. Cost 183,400 183,000 185,000 185,700 185,700 184,400 184,000 186,000 a. : , 183, 185,500 » 183,900 83,500 196400 183, d 185,900 183,900 (adapted) 185,500ys? when should process Costing techniques be used in assignine Cost io produc ise 13. a. Ifthe product is manutactured on the basis of ea b. When production is only partially compi: accounting period. tthe product is com eceived Juring the ao Posed of mass-produced hoy sceneous units Whenver standard Costing techniques should 10! be ee R (AICPA) 74. Which of the following is a characteristic of a process costing systeni2 a. Work-in-process inventory isrestated in terms of completed uni; b. Costs are accumulated by order. c. Itisused bya Company manufacturing custom machinery d. Standard costs are not applicable. {AICPA} 75. From the industries listed below, which one is most likely fo use process costing in accounting for production Costs? a. Road builder. b. Hectrical contractor. ¢. Newspaper publisher. d. Automobile fepair shop. (CIA) 76. ‘An equivalent unit of material or Conversion Cost is equal to Qa. The amount of material or conversion cost necessary to complete one unit of production. b. Aunit of ee inventory. Cc. The amount of material or conversion cost necessary t Unit of production in work-in-process, 'Y to start a d. Fifty percent of the material or c: 4 Conversion cost of g goods inventory (assuming a linear UNit Of finishy Production Pattern) sned (AICPA) 77. The percentage of completion of the beginning Mork-in-process iny, : : nt should be considered in the computation of the equivalent units ef Production for which of the following methods of Process costing FIFO. Weighted Average No a. Yes b. Yes Yes c. No 1G id} No to (AICPA)oo = 958 Ch te . erred in from the first department to the second de, 78. The nie ral Sed in the computation of the equivalent units for the «een! should senor which of the following methods of process outed 1g deparimen! FIFO Weighted Average o. Yes Ney b. Yes . jo c. No es dg. No re (AICP) ess costing system, the equivalent units of production computed using the weighted-average method. With respect to cony Ore costs, the percentage of completion for the current period only is includeg in the calculation of the 79. Inagiven proc Beginning Work-in- Ending Work-in- Process inventory Process Inventory a No No b. No Yes Cc. Yes No d. Yes Yes (AICPA) 80. Ina process costing system, how is the unit cost affected in a production cost report when materials are added in a department subsequent to the first department and the added materials result in additional units? a. The first departments unit cost is increased, which necessitates an adjustment of the transferred-in unit cost. b. The first department's unit cost is decreased, which necessitates an adjustment of the transferred-in unit cost. c. The first department's unit cost is increased, but it does n°! necessitate an adjustment of the transferred-in unit cost d. The first department's unit cost is decreased. but it does no! necessitate an adjustment of the transtered-in unit cost (acral