ACC 650 Week 2 Quiz | Assignment Help | Grand Canyon University

ACC 650 Week 2 Quiz | Assignment Help | Grand Canyon University 




1.         Companies that use a process-cost accounting system would:

 

·        establish a separate Work-in-Process Inventory account for each manufacturing department.

·        establish a separate Finished-Goods Inventory account for each manufacturing department.

·        pass completed production directly to Cost of Goods Sold.

·        charge goods produced with actual overhead amounts rather than applied overhead amounts.

·        eliminate the need for the Finished-Goods Inventory account.

 

2.

Which of the following is a nonmanufacturing business where process costing would most likely be used?

 

·        A beauty shop.

·        A tailoring shop.

·        A laboratory that tests water samples for lead

·        A furniture repair shop.

·        An auto body shop.

 

3.

Which of the following manufacturers would most likely not use a process-cost accounting system?

 


·        A producer of computer monitors.

·        A paint manufacturer.

·        A producer of frozen orange juice.

·        A builder of customized yachts.

·        A lumber mill.

 

 

 

4.

All of the following statements about an operation-costing system is true except:

 

 

·        direct material and conversion costs are traced to each batch of product produced.

·        direct-material cost is traced to each batch produced.

·        conversion costs are applied to products on a departmental basis using a predetermined application rate.

·        batches of product pass sequentially through the same processes.

·        conversion activities are similar across product lines but direct materials differ significantly.

 

 

5.

Operation costing:

 

·        tends to parallel job-order costing with respect to the treatment of conversion cost.

·        tends to parallel process costing with respect to the treatment of conversion cost.

·        tends to parallel process costing with respect to the treatment of direct materials.

·        would likely be used by a manufacturing plant that produces one model of a single product.

·        is commonly known as a joint-costing system.

 

 

6.

Process costing is used to account for:

 

·        large numbers of identical products that are produced in a continuous manufacturing environment.

·        small numbers of products that are produced in batches.

·        raw materials that are converted directly to finished goods

·        finished goods that are refined and processed further.

·        large numbers of products that are produced in a non-repetitive process.

 

 

7.

Hornsby has a single production department, and uses a process-costing system. The balance in its Work-in-Process account on January 1 was $68,000. The account was charged with direct materials, direct labor, and manufacturing overhead of $450,000 throughout the year. If a review of the accounting records determined that $86,000 of goods were still in production at year-end, Hornsby should make a journal entry on December 31 that includes:

 

 

·        a debit to Cost of Goods Sold for $432,000.

·        a debit to Finished-Goods Inventory for $432,000.

·        a debit to Work-in-Process Inventory for $432,000.

·        a debit to Finished-Goods Inventory for $86,000.

·        a credit to Work-in-Process Inventory for $86,000.

 

 

8.

Linder Corporation had 8,200 units of work in process on November 1. During November, 26,800 units were started and as of November 30, 7,900 units remained in production. How many units were completed during November?

 

 

·        16,100

·        26,500.

·        27,100.

·        42,800.

·        None of the answers is correct.

 

 


9.

Which of the following is true concerning cost drivers for the predetermined overhead rate in a process-costing system?

 

·        Predetermined overhead rates are not used in a process-costing system.

·        If direct material cost is the cost driver, direct labor and direct materials may be combined into the single element of prime cost.

·        If direct labor hours is the cost driver, direct labor and manufacturing overhead may be combined into the single element of conversion cost.

·        If direct labor cost is the cost driver, direct labor and manufacturing overhead may be combined into the single element of conversion cost.

·        Cost drivers are irrelevant in process-costing systems.

 


10.

Xin Co., had 3,000 units of work in process on April 1 that were 60% complete. During April, 10,000 units were completed and as of April 30, 4,000 units that were 40% complete remained in production. How many units were started during April?

 

 

·        8,600.

·        9,800.

·        11,000.

·        12,200.

·        None of the answers is correct.

 

 


11.

Harrington Industries, which uses a process-costing system, had a balance in its Work-in-Process account of $68,000 on January 1. The account was charged with direct materials, direct labor, and manufacturing overhead of $450,000 throughout the year. If a review of the accounting records determined that $86,000 of goods were still in production at year-end, Harrington should make a journal entry on December 31 that includes:

 

·        a debit to Cost of Goods Sold for $432,000.

·        a credit to Finished-Goods Inventory for $432,000.

·        a credit to Work-in-Process Inventory for $432,000.

·        a debit to Finished-Goods Inventory for $86,000.

·        a credit to Work-in-Process Inventory for $86,000.

 



12.

Mulligan, Inc., which uses a process-cost accounting system, passes completed production from Department A to Department B for further manufacturing. The journal entry to record completed production in Department A requires:

 

 

·        a debit to Work-in-Process Inventory and a credit to Finished-Goods Inventory.

·        a debit to Finished-Goods Inventory and a credit to Work-in-Process Inventory.

·        a debit to Finished-Goods Inventory and a credit to Work-in-Process Inventory: Department A.

·        a debit to Work-in-Process Inventory: Department A and a credit to Work-in-Process Inventory: Department B.

·        a debit to Work-in-Process Inventory: Department B and a credit to Work-in-Process Inventory: Department A.

 


13

In a process-costing system, manufacturing costs are accumulated by:

 

·        batch.

·        batch and time period.

·        department, only.

·        department and time period, only.

·        department or process, and time period

 

 


14

Bratton Corporation had 6,500 units of work in process on April 1. During April, 19,100 units were completed and as of April 30, 5,100 units remained in production. How many units were started during April?

 

·        11,600

·        17,700.

·        20,500.

·        30,700.

·        None of the answers is correct.

 



15.

When computing the conversion cost per equivalent unit under the weighted-average method of process costing, all of the following information would be needed except:

·        the number of units completed during the current accounting period.

·        the conversion work performed during the current period on the ending work-in-process inventory.

·        the conversion work performed during the current period on the beginning work-in-process inventory.

·        the conversion cost in the beginning work-in-process inventory.

·        the conversion cost incurred during the current accounting period.

 

 


16.

Gulliver, Inc., which uses a process-costing system, transfers completed production from Department no. 1 to Department no. 2 for further work. Which of the following best describes the account that would be debited to record this transfer?

 

·        Cost of Goods Transferred.

·        Finished-Goods Inventory: Department no. 1.

·        Finished-Goods Inventory: Department no. 2.

·        Work-in-Process Inventory: Department no. 1.

·        Work-in-Process Inventory: Department no. 2.

 



17.

Oxford, Inc., which uses a process-cost accounting system, began operations on January 1 of the current year. The company incurs conversion cost evenly throughout manufacturing. If Oxford started work on 3,000 units during the period and these units were 70% of the way through manufacturing, it would be correct to say that the company has:

 

·        3,000 physical units in production.

·        2,100 completed units.

·        900 in-process units.

·        900 equivalent units of production.

·        3,000 equivalent units of production.

 

 

 

18.

Which of the following data are needed to calculate total equivalent units under the weighted-average method?

 

 

·        Work-to-date on ending work in process, units started during the period.

·        Units completed during the period, work-to-date on ending work in process.

·        Work to complete beginning work in process, work-to-date on ending work in process.

·        Work to complete beginning work in process, units completed, and work done on ending work in process.

·        Units completed, work to complete beginning work in process.

 

 

 

19.

Operation costing might be used to determine the cost of all of the following products except:

 

·        sweaters.

·        automobiles.

·        living-room sofas.

·        dishwashing detergent.

·        high-definition (HD) and surround-sound cables.

 

 

 

 

20.

Which method of process costing is almost always used in practice?

 

·        Weighted average method

·        LIFO method

·        Straight-line method

·        Accelerated method

·        None of these answers is correct.

 

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