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Exam 3: Process Costing and Analysis

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Question 101

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________ distinct groups of units must be considered in determining the equivalent units of production under the FIFO method of process costing.

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Question 102

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If the predetermined overhead allocation rate is 85% of direct labor cost and the Polishing Department's direct labor cost for the reporting period is $20,000, the following entry would be made to record the allocation of overhead to the products processed in this department:

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Question 103

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Which of the following pair of journal entries correctly records the current month's activity where $125,000 of raw material was purchased for cash, and $75,000 of direct material and $30,000 of indirect materials were used in the production process?

A company uses a process cost accounting system and the FIFO inventory valuation method.Its Assembly Department's beginning inventory consisted of 50,000 units, three-fourths complete with respect to direct labor and overhead.The department started and finished 127,500 units this period.The ending inventory consists of 40,000 units that are one-fourth complete with respect to direct labor and overhead.All direct materials are added at the beginning of the process.Goods in Process included direct labor costs of $24,000 and overhead costs of $32,000 for the period.The direct labor cost per equivalent unit is:

The company uses the same predetermined overhead allocation rate (based on direct labor)for the Pickling and Canning Departments.

If a production department has 100 equivalent units of production with respect to direct materials in a given reporting period, the equivalent units of production with respect to direct labor also must be 100.