GCU ACC650 Week 2 Quiz

GCU ACC650 Week 2 Quiz

GCU ACC650 Week 2 Quiz

Question

ACC650 Managerial Accounting

Week 2 Quiz

•Equivalent-unit
calculations are necessary to allocate manufacturing costs between:

•units
completed and ending work in process.

•beginning
work in process and units completed.

•units sold
and ending work in process.

•cost of
goods manufactured and beginning work in process.

•cost of
goods manufactured and cost of goods sold.

•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.

•Process
costing would likely be used in all of the following industries except:

•petroleum
refining.

•chemicals.

•truck tire
manufacturing.

•wood pulp
production.

•automobile
repair.

•Corrigan,
Inc. overstated the percentage of work completed with respect to conversion
cost on the ending work-in-process inventory. What is the effect of this
overstatement on conversion-cost equivalent units and physical units
manufactured, respectively?

•Overstated,
overstated.

•Overstated,
understated.

•Overstated,
none.

•None,
overstated.

•None,
none.

•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.

•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.

• 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.

•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.

• 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.

•All of the
following statements about an operation-costing system are 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.

•When
calculating unit costs under the weighted-average process-costing method, the
unit cost is based on:

•only the
current period’s manufacturing costs.

•only costs
in the period’s beginning work-in-process inventory.

•a
summation of the costs in the beginning work-in-process inventory plus costs incurred
in the current period.

•only costs
incurred in previous accounting periods.

•a
summation of the costs in the beginning work-in-process inventory plus costs to
be incurred in the upcoming period.

•Forte Co.,
had 3,000 units of work in process on April 1 that were 60% complete. During
April, 11,000 units were started and as of April 30, 4,000 units that were 40%
complete remained in production. How many units were completed during April?

•10,000.

• 9,800.

•11,000.

•12,200.

•None of
the answers is correct.

•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.

•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.

•Which of
the following is a key document in a typical process-costing system?

•Departmental
production report.

•Master
schedule.

•Production
budget.

•Sequential
product report.

•Materials
requirement report.

•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.

•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.

•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.

•Unit costs
in a process-costing system are derived by using:

•in-process
units.

•completed
units.

•physical
units.

•equivalent
units.

•a measure
of activity other than those listed above.

•Breight,
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 credited 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.

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