1. Which of the following would use process costing? Accounting firm Custom furn

Question

1. Which of the following would use process costing? Accounting firm Custom furniture manufacturer Crayon manufacturer A. C. D. Airplane manufacturer 2. Equivalent units are usually determined for A. direct materials and conversion costs B. direct labor and conversion costs direct materials only conversion costs only. C. D. 3. Recording the transfer of the cost of items completed in the Forming Department to the Packaging Department would include a: A. credit to Work in Process Inventory-Packaging. B. debit to Work in Process Inventory-Forming. C. debit to Finished Goods Inventory D. debit to Work in Process Inventory Packaging. Conversion costs include: A. direct labor and manufacturing overhead. B. manufacturing overhead only C. direct materials and direct labor. D. direct materials and manufacturing overhead. 4. The number of equivalent units is computed as: A. the number of complete units transferred to the next process. B. the number of physical units x percentage of completion. C. 5, the number of partially complete physical units plus the number of units transferred to the next process. beginning Work in Process inventory plus the units transferred in from the previous process. D. Hay Company had 3,000 units in its beginning inventory, 2,000 units in its ending inventory, and completed and transferred out 14,000 during the month. What are the total units to account for? A. 13,000 B. 16,000 C. 17,000 D. 19,000 6. Which of the following is included in the costs transferred out of the second process of a three- step production process? A. Costs incurred in the current process B. Costs incurred in the previous process C. Costs of the previous process combined with costs of the current process 7. D. Costs of the current process combined with costs of the next process

Explanation / Answer

1) option c Crayon manufacturer 2) option a Direct materials and conversion costs 3) option d Debit to work in process inventory-Packaging 4) option a direct labor and manufacturing overhead 5) option c the number of partially complete physical units plus the number of units transferred to the next process 6) beginning wip 3000 Transferred 14000 started during the year 3000 ending wip 2000 units to be accounted 16000 units accounted for 16000 option B) $16,000 7) option c cost of the previous process combined with the costs of the current process

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