Calculation of cost of goods sold using job costing system.
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Molding
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Assembly
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Manufacturing overhead cost
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$1,200,000
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$800,000
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Machine hours
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10,000
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4,000
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Direct labor hours
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12,000
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16,000
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Alana Company had the following three jobs in process at the end of September.
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Job No. 4
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Job No. 5
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Job No. 6
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Direct materials
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$ 64,000
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$ 36,000
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$50,000
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Direct labor
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$128,000
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$106,000
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$80,000
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Machine hours
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2,400
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1,600
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2,000
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Alana uses a predetermined overhead rate of $20 per machine hour to apply overhead.
All three jobs were started during September. Job No. 5 and Job No. 6 were completed during the month, and Job No. 6 was sold on September 20.
There were no beginning inventory balances.
1. Alana's cost of goods sold for September would be
a.$-0-
b$170,000
c.$130,000
d.$344,000
2. Alana's ending finished goods inventory for September would be
a.$414,000
b.$334,000
c.$174,000
d.$142,000
3. Alana's ending work-in-process inventory for September would be
a.$240,000
b.$192,000
c.$176,000
d.$-0-
4. The following information is provided:
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Units
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Work in process, April 1 (20% complete)
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5,000
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Started in April
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18,000
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Materials are added at the beginning of the process.
If 17,000 units were completed during the month, ending work in process at April 30 would be
a.6,000
b.5,000
c.1,000
d.12,000
5. The following amounts were selected from the production report of Chandon Corporation:
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Actual units in production
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42,000
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Equivalent units (materials)
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42,000
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Equivalent units (conversion)
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39,000
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Cost per equivalent unit (materials)
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$1.10
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Cost per equivalent unit (conversion)
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$0.90
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Chandon uses the weighted average method in preparing its production reports. Chandon's total production cost to be accounted for must have been
a.$81,300
b.$84,000
c.$89,100
d.$72,900
6. If the cost of materials increased from January to February and there is beginning inventory for each month, which of the following statements would be true? (Assume all other factors are held constant.)
a.Only the weighted average method would result in an increase in the unit cost for February.
b.Only the FIFO method would result in an increase in the unit cost for February.
c.Both the weighted average method and the FIFO method would result in an increase in the unit cost for February; however, the weighted average method would result in a greater unit cost for units in February than the FIFO method.
d.Both the weighted average method and the FIFO method would result in an increase in the unit cost for February; however, the FIFO method would result in a greater unit cost for units in February than the weighted average method.
7. The following information is provided by the Hudson Company for the month of March:
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Number of units sold
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155000
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Inventory at March 1:
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Work in process
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-0-
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Finished goods
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25000
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Inventory at March 31:
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Work in process (20% complete)
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10000
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Finished goods
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20000
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Hudson's manufacturing operations consists of one department using the weighted average method. What were the equivalent units of production for conversion costs in March?
a.150,000
b.152,000
c.160,000
d.158,000
8. For the month of November, one department of the Watkins Company had 64,000 equivalent units of production with respect to conversion cost. Work-in-process inventory on November 1 had 7,500 units and was 50 percent complete. During November, 62,500 units were started and 60,000 were completed and transferred to the next department. Assuming the Watkins Company uses the weighted average cost method, the ending work-in-process inventory in the department
a.was 50 percent complete with respect to conversion costs
b.was 40 percent complete with respect to conversion costs
c.consisted of 2,500 units
d.consisted of 7,500 units
9. The partial production report of Seville Corporation is as follows:
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Transferred
Out
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Ending
Work in Process
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Total
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Costs accounted for:
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Goods transferred out
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?
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?
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Goods in ending work in process:
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Materials (20,000 $0.15)
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$3,000
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$3,000
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Conversion (8,000 $0.05)
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400
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400
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Total costs accounted for
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?
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$3,400
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$17,400
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Seville Corporation uses the weighted average method to prepare production reports. How many units did Seville complete and transfer?
a.28,000
b.20,000
c.70,000
d.Units cannot be computed given the above information.
10. The Packing Department receives goods produced in previous departments. The costs transferred into the Packing Department are treated as
a.conversion cost incurred uniformly throughout the process
b.materials cost added at the end of the process
c.materials cost added at the beginning of the process
d.either materials cost or conversion cost, depending on whether the firm uses FIFO or weighted average