Question Details

ACCT 505
WEEK 2
 4.
Question :
(TCO F) Which of the following accounts is debited when direct labor is recorded?

 
Student Answer:
 
 Work in process
 


 Salaries and wages expense
 


 Salaries and wages payable
 


 Manufacturing overhead
 
Instructor Explanation:
Chapter 3


Question :
(TCO F) During February, Degan Inc. transferred $60,000 from Work in Process to Finished Goods and recorded a Cost of Goods Sold of $65,000. The journal entries to record these transactions would include a:

 debit to Finished Goods of $65,000.

 credit to Cost of Goods Sold of $65,000.
 
 credit to Work in Process of $60,000.

 credit to Finished Goods of $60,000.
Question :
(TCO F) Whether a company uses process costing 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. Natural gas production company
iv. Dairy farm
v. Coal mining company
vi. Specialty coffee roaster (roasts small batches of specialty coffee beans)

For each company, indicate whether the company is most likely to use job-order costing or process costing.
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 hours
Direct labor wage rate
$14 per labor-hour
Machine Hours
1,480 machine hours
Number of units completed
3,700 units

 
The company applies manufacturing overhead 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.
Question :
(TCO F) Miller Company manufactures a product for which materials are added at the beginning of the manufacturing process. A review of the company's inventory and cost records for the most recently completed year revealed the following information: 

Units 
Materials 
Conversion
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.

ii. Determine the cost transferred to finished goods.

iii. Determine the amount of cost that should be assigned to the ending work in process inventory.
Question :
(TCO F) Weisinger Corporation has provided the following data for the month of January:
  
Inventories

Beginning
Ending

Raw materials
$28,000 
$29,000 

Work In process
$16,000 
$14,000 

Finished goods
$42,000 
$54,000 

  
Additional Information


Raw material purchases
$56,000 

Direct labor costs
$87,000 

Manufacturing overhead cost incurred
$51,000 

Indirect materials included in manufacturing overhead costs incurred
$3,000 

Manufacturing overhead cost applied to work in process
$55,000 

 
 
Prepare a Schedule of Cost of Goods Manufactured and a Schedule of Cost of Goods Sold in good form.