PROCESS COSTING

50. When manufacturing overhead costs are assigned to production in a process cost system, they are
debited to
a. the Finished Goods Inventory account.
b. Cost of Goods Sold.
c. a Manufacturing Overhead account.
d. the Work in Process account.

51. A product requires processing in two departments, Department A and then Department B, before it
is completed. Costs transferred out of Department A will be transferred to
a. Finished Goods Inventory.
b. Cost of Goods Sold.
c. Work in Process—Department B.
d. Manufacturing Overhead.

52. Which of the following would not appear as a debit in the Work in Process account of a second
department in a two stage production process?
a. Materials used
b. Overhead applied
c. Labor assigned
d. Cost of products transferred out

53. Materials requisitions are

a. not used in process costing.
b. generally used more frequently in process costing than job order costing.
c. generally used less frequently in process costing than job order costing.
d. used more frequently by latter stage production departments.

54. A primary driver of overhead costs in continuous manufacturing operations is

a. direct labor dollars.
b. direct labor hours.
c. machine hours.
d. machine maintenance dollars.

55. Price Manufacturing assigns overhead based on machine hours. Department A logs 1,200 machine
hours and Department B shows 2,000 machine hours for the period. If the overhead rate is $5 per
machine hour, the entry to assign overhead will show a
a. debit to Manufacturing Overhead for $16,000.
b. credit to Work in Process—Department B for $10,000.
c. debit to Work in Process for $10,000.
d. credit to Manufacturing Overhead for $16,000.

56. Barnes and Miller Manufacturing is trying to determine the equivalent units for conversion costs
with 3,000 units of ending work in process at 80% completion and 14,000 physical units. There are
no beginning units in the department. Conversion costs occur evenly throughout the entire production
period. What are the equivalent units for conversion costs for the current period?
a. 17,000
b. 16,800
c. 2,400
d. 13,400
 57. 7,000 units in a process that are 70% complete are referred to as
a. 7,000 equivalent units of production.
b. 2,100 equivalent units of production.
c. 4,900 equivalent units of production.
d. 2,100 unequivalent units of production.

58. A process with no beginning work in process, completed and transferred out 45,000 units during a
period and had 30,000 units in the ending work in process inventory that were 30% complete. The
equivalent units of production for the period were
a. 45,000 equivalent units.
b. 75,000 equivalent units.
c. 54,000 equivalent units.
d. 22,500 equivalent units.

Use the following information for questions 59–60.

A department adds raw materials to a process at the beginning of the process and incurs conversion costs
uniformly throughout the process. For the month of January, there were no units in the beginning work in
process inventory; 80,000 units were started into production in January; and there were 20,000 units that
were 40% complete in the ending work in process inventory at the end of January.

59. What were the equivalent units of production for materials for the month of January?
a. 88,000 equivalent units
b. 72,000 equivalent units
c. 60,000 equivalent units
d. 80,000 equivalent units

60. What were the equivalent units of production for conversion costs for the month of January?
a. 60,000 equivalent units
b. 72,000 equivalent units
c. 68,000 equivalent units
d. 80,000 equivalent units