1. Metaphor Electronics Inc., a cell phone manufacturing company, manufactures keypads in one process. It also manufactures batteries in a second process and speakers in the third process. These three major subcomponents are assembled together in the final process to manufacture the cell phone. This scenario is an example of _____.
sequential processing
parallel processing
partial processing
job-order processing
2. Trux Metals Inc. manufactures a product that passes through three departments: Melting, Skimming, and Molding. In August, the company produced 1,200 units with the following costs:
| Melting Department |
Skimming Department |
Molding Department |
||||
| Direct materials | $1,600 | $2,200 | $1,200 | |||
| Direct labor | 250 | 220 | 400 | |||
| Overhead | 800 | 900 | 600 | |||
Which of the following is the journal entry to transfer costs from the skimming department to the molding department? Assume that there is no beginning or ending work in process in each department.
Debit Work in Process (Molding) by $5,970 and Credit Work in Process (Skimming) by $5,970
Debit Work in Process (Melting) by $2,650 and Credit Work in Process (Molding) by $2,650
Debit Finished Goods by $3,320 and Credit Work in Process (Molding) by $3,320
Debit Work in Process by $8,170(Skimming) and Credit Finished Goods by $8,170
3. Which of the following is a section of a production report?
Finished goods section
Departments information section
Selling price information section
Unit information section
4. Dynamic Controls Inc., a computer manufacturing company, has 2,500 completed units in May. In ending work in process, there are 1,200 units, 40% complete. There is no beginning work in process in May. What is the equivalent unit for May?
2,500
2,980
1,200
1,480
5. Lavender Global Inc., a manufacturing company, incurred manufacturing costs of $22,000 in August. In August, the company manufactured 1,800 units, and 1,000 units were in ending work in process, 20% complete. Assume that there is no beginning work in process. What is the total cost of ending work in process for August?
$1,800
$1,980
$2,200
$2,000
6. Which of the following is true of the FIFO costing method of treating beginning work-in-process inventory?
It assumes that the work done in the prior period for the units in the beginning inventory is counted as part of the total equivalent work.
It separates work and costs of the equivalent units in the beginning inventory from that of the current period.
It considers only the work and costs of the equivalent units in the beginning inventory.
It combines beginning inventory costs and work done with current period costs and work to calculate the period’s unit cost.
7. During March, a manufacturing company completed and transferred out 35,000 units. In beginning work in process, there were 12,000 units, 80% complete. In ending work in process, there were 7,000 units, 30% complete. Calculate the equivalent units for March.
35,000 units
47,200 units
42,000 units
37,100 units
8. Which of the following is the mathematical expression to calculate the units started during a period while preparing the physical flow schedule?
Units Started = Units Started and Completed + Units in Ending Work in Process
Units Started = Total Units Completed + Units in Beginning Work in Process
Units Started = Units in Beginning Work in Process + Units in Ending Work in Process
Units Started = Units Started and Completed – Units in Beginning Work in Process
9. Athena Inc. manufactures a product that passes through two processes. The following information is available for the first department for July.
| Production: | |
| Units in process, July 1, 75% complete | 30,000 |
| Units completed and transferred out | 75,000 |
| Units in process, July 31, 25% complete | 15,000 |
Calculate the total units for July if the company follows the weighted average method.
120,000 units
105,000 units
90,000 units
95,000 units
1. Parallel Processing
This is a processing pattern where 2 or more sequential processes are done in order to produce a finished good.
2. Debit Work in Process (Molding) by $5,970 and Credit Work in Process (Skimming) by $5,970
$5,970 = ($1,600 + $250 + $800) + ($2,200 + $220 + $900)
3. Unit information section
This includes usually the physical flow of units in and out of a department.
4. 2,980 units
2,500 completed units + (1,200 units x 40%)
5. $ 2,200
Total units = 1,800 + (1,000 x 20%) = 2,000.
Cost per unit = $22,000 / 2,000 = $11
Cost of ending work in process = 1,000 x 20% x $11 = 2,200
6. It separates work and costs of the equivalent units in the beginning inventory from that of the current period.
7. 37,100 units
35,000 completed units + (7,000 units x 30%)
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