ACC 505 Managerial Accounting

1.Whether a company uses process costing or job-order costing depends on its industry. A number of companies in different industries are listed below:   i. Brick manufacturer ii. Contract printer that produces posters, books, and pamphlets to order iii. Natural gas production company iv. Dairy farm v. Coal mining company vi. Specialty coffee roaster (roasts small batches of specialty coffee beans) For each company, indicate whether the company is most likely to use job-order costing or process costing.

   

2.Job 827 was recently completed. The following data have been recorded on its job cost sheet:  

Direct materials	$61,050
Direct labor hours Save Time On Research and Writing Hire a Pro to Write You a 100% Plagiarism-Free Paper. Get My Paper	1,332 labor hours
Direct labor wage rate	$14 per labor-hour
Machine Hours	1,480 machine hours
Number of units completed	3,700 units

 

The company applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $13 per machine-hour.

 

3.Harmon Company uses the weighted-average method in its process costing system. The Curing Department of Harmon Company reported the following information for the month of November.

 

 

 

8,000

      

Units	Percentage complete with respect to conversion
Work in process, November 1	10,000		80%
Units started	2	8,000
Completed and transferred out	30,000
Work in process, November 30	30%
Costs for November	Materials	Conversion
Work in process, November 1	$34,500	$48,600
Added during the month	$146,000	$194,400

 

  All materials are added at the beginning of the process. Required: Compute the following items using the weighted-average method: i. The equivalent units of production for materials. ii. The cost per equivalent unit for conversion. iii. The total cost assigned to units transferred out of the Curing Department during November. iv. The cost assigned to work in process inventory as of November 30

   

4.Baroche Inc. uses the weighted-average method in its process costing system. The following data concern the operations of the company’s first processing department for a recent month.

 

 

 

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 Materials cost

 Conversion cost

 

 Units in process

 Percent complete with respect to materials80% Percent complete with respect to conversion70%

Work in process, beginning:
	Units in process	100
	Percent complete with respect to materials		70%
	Percent complete with respect to conversion	40%
Costs in in the beginning inventory:
	Materials cost	$364
	Conversion cost	$1,120
Units started into production during the month	23,000
Units completed and transferred out	22,900
Costs added to production during the month:
$124,160
$637,088
Work in proccss, ending
200

  Using the weighted-average method:   i. Determine the equivalent units of production for materials and conversion costs.   ii. Determine the cost per equivalent unit for materials and conversion costs.   iii. Determine the cost of units transferred out of the department during the month.   iv. Determine the cost of ending work in process inventory in the department.