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FEU DILIMAN

BSA 21
ADVANCED COST ACCOUNTING

Name: ________________________________________ Date: ____________________

QUIZ 1

1. In process cost system, costs are assigned only:


a. To one work in process inventory account
b. To work in process and finished goods inventories
c. To work in process, finished goods, and cost of goods sold
d. To work in process inventory accounts

2. Indicate which of the following statements is not correct.


a. Both a job order and a process cost system track the same three
manufacturing cost elements direct materials, direct labor, and
manufacturing overhead.
b. In a job order cost system, only one work in process is used, while in
process cost system, multiple work in process inventory accounts are
used.
c. Manufacturing costs are accumulated the same way in a job order and in a
process cost system.
d. Manufacturing costs are assigned the same way in a job order and in a
process cost system.

3. In making the journal entry to record raw materials costs:


a. The debit is to Finished Goods Inventory
b. The debit is often to two or more work in process inventory accounts
c. The credit is generally to two or more work in process accounts
d. The credit is to Finished Goods Inventory

4. A cost of production report:


a. Is an external report
b. Shows costs charged to department and costs accounted for
c. Shows equivalent units of production but not physical flow of units
d. Contains six sections

5. The restatement of incomplete units in terms of completed units is called:


a. Quantities produced
b. Total production
c. Equivalent production
d. Approximate production

6. An equivalent unit of material or conversion cost is equal to:


a. The manufacturing costs necessary to complete one unit of production
b. a unit of work in process inventory
c. the manufacturing costs necessary to start a unit of production in to work
in process
d. fifty percent of manufacturing costs of a unit of finished goods inventory

7. An item that does not appear on a cost of production report is:


a. beginning work in process inventory
b. cumulative costs through the end of departmental production
c. ending work in process inventory
d. ending finished goods inventory
8. Department 1 had put 95,000 units into process during the period and had
ending units in process of 21,000 units.

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What is the number of units transferred to finished goods inventory, if
Department 2s ending units in process are 12,000?
a. 104,000
b. 83,000
c. 74,000
d. 62,000

9. Red Company has 6,000 units in process at the beginning of the month in
Department 1. During the month, an additional 14,000 units were placed into
process.

If Red Company had 4,200 units in process at the end of the month, what is
the number of units transferred to Department 2, assuming all units
completed in Department 1 are transferred to Department 2?
a. 15,800
b. 18,200
c. 20,000
d. 24,200

10.The cost of materials put into production in a department during the month
totalled P188,400. By the end of the month, these materials had been used
for P32,000 units, of which 29,000 were completed and transferred out and
3,000 were in process. Eighty percent of materials were added to the units in
process.

What is the equivalent unit of production for materials?


a. 31,400
b. 32,000
c. 29,600
d. 31,000

11.Using the data in Number 10, what is the cost per equivalent unit for
materials?
a. P6.00
b. P5.89
c. P6.50
d. 6.36
Items 12 to 14 are based on the following data for the Finishing Department of the
Lovely Company in January:
Beginning Inventory -0-
Units transferred in during the month 4,700
Units transferred to Finished Goods during the month 4,300
Ending work in process (25% complete as to labor) 400
Labor costs incurred for month P14,080
12.What is the equivalent production for labor during the month?
a. 4,400
b. 4,600
c. 4,700
d. 4,300
13.What is the labor cost per equivalent unit?
a. P3.20
b. P3.06
c. P3.00
d. P3.27

14.What is the labor cost in the ending work in process?

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a. P 320
b. P 306
c. P1,280
d. P 960

Items 15 to 18 are based on the following data for the Grinding Department of the
West Company in November:
Beginning inventory -0-
Units placed in production during the month 73,000
Units transferred to next department during the month 67,000
Ending work in process (1/3 complete as to overhead) ?
Overhead costs incurred for month P282,900
15.What is the number of units in the ending work in process?
a. 6,000
b. 4,000
c. 5,000
d. 7,000

16.What is the equivalent production for overhead during the month?


a. 69,000
b. 73,000
c. 71,000
d. 67,000

17.What is the overhead cost in the units transferred out?


a. P247,000
b. P274,700
c. P247,700
d. P250,800

18.What is the overhead cost in the ending inventory of work in process?


a. P 8,200
b. P24,600
c. P 7,720
d. P 7,960

Use the following data in answering items 19 to 22:


During the month, 3,900 units of product were started into production in a
department, of which 3,700 were completed. Of the 3,700 completed units, 80 are
still on hand in the department and have not been physically transferred to the next
department. There are also units still in process; they are estimated to be 65
percent complete as to labor and overhead. Labor for the month was P27,193.
19.What is the labor cost applicable to the units transferred to the next
department?
a. P25,702
b. P27,193
c. P27,502
d. P20,705
20.What is the labor cost applicable to the units completed and still on hand?
a. P 568
b. P1,420
c. P1,240
d. P5,680

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21.What is the number of uncompleted units on hand?
a. 200
b. 300
c. 400
d. 500

22.What is the labor cost applicable to the uncompleted units on hand?


a. P 923
b. P9,230
c. P1,420
d. P 142

Questions 23 and 24 relate to Spring Company which bottles mineral water. The
water is filtered in Department 1 and then flows through to Department 2 where it is
bottled. The companys only direct material cost occurs in the bottling stage. The
quantity schedules of Spring Company are as follows:
Department 1
Units started in process 110,000
Units transferred to Department 2 80,000
Units in process, end 30,000
Department 2
Units received from Department 1 80,000
Units transferred to finished goods inventory 61,400
Units in process, end 18,600
23.Direct materials equivalent units of production for Department 1 are:
a. 0
b. 80,000 units
c. 101,000 units
d. 110,000 units

24.Department 2 would have how many equivalent units of production, on the


basis of a conversion cost computation?
a. 61,400 units
b. 68,929 units
c. 74,792 units
d. 80,000 units

25.Below is the quantity schedule for Department 2 of Tuason Company:


Units to be accounted for:
Units received from Department 1 37,000
Units accounted for:
Units transferred to finished goods 28,000
Units in process, end (35% complete as to conversion cost)
9,000

Cost data:
Cost from preceding department P24,050
Conversion costs added this period 18,690

What is the cost of units in process, end?


a. P5,850
b. P7,740
c. P1,890
d. P6,540

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26.The production data for Department 2 are as follows:
Units received from preceding department 55,000
Units added to production 5,000
Units finished and transferred out 48,000
Ending units in process (direct materials, 100%,
conversion costs, 70% complete) 12,000
Costs from preceding department P24,750
Costs added by department:
Materials P 7,200
Conversions costs P53,580
27.The RC Corporation manufactures toy cars. In Department 1, the body of the
toy car is formed out of plastic. In Department 2, four rubber wheels are
placed on each car at the end of the process. Because low is the activity of
Department 2 for May:

Units transferred in 15,000


Cost transferred in P13,500
Costs incurred by Department 2:
Direct materials P 0.02 each rubber wheel
Conversion costs P14,210
Units in process, end 3,000 (2/3 complete as to
conversion costs, no direct materials)

What is the total costs of completed units transferred out to Department 2?


a. P21,935
b. P23,940
c. P21,915
d. P23,220

28.Below are data pertaining to Department 2 of Magdalo Company that uses a


process cost system:
Units received from Department 1 500,000
Units added to production 100,000
Units transferred to finished goods 530,000
Ending units in process 10% are 30% complete
40% are 60% complete
15% are 75% complete
35% are 85% complete
Costs transferred in P300,000
Cost added by department:
Direct materials P559,350
Conversion costs P606,480

Direct materials are added at the 62% stage of production and conversion
costs are added evenly throughout the process. No beginning work in process
inventory exists.

What is the cost of ending work in process inventory?

a. P119,630
b. P 84,630
c. P191,630
d. P126,630

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29.Production data taken from the Costs to be Accounted For section of the Cost
Schedule of Oakwood Company with two production departments is as
follows:
Department Department
1 2
Unit cost:
Direct materials P4.29 P -
Direct labor 2.93 3.19
Overhead 1.17 1.20

Equivalent production:
Direct labor 20,000
Overhead 20,000

If department 1 transferred 32,000 units to Department 2, what is the total


cost to be accounted for Department 2?
a. P356,280
b. P255,600
c. P419,716
d. P 87,800

30.Department 3 of the Peninsula Company has the following pieces of data


included in its cost of production report:
Quantities:
Units transferred in from Department 2
78,300
Units in process, end ?
Total Unit
Cost Cost
Cost to be accounted for:
Cost from preceding department P391,50 ?
0
Costs added by department:
Direct materials P P1.23
80,000
Conversion costs P150,00 P2.50
0

Cost accounted for:


Transferred to finished goods P508,95
9

Additional data:
Ending units in process in Department 3 are 100% complete as to direct
materials and 45% complete as to conversion costs.

What is the amount of total costs accounted for?


a. P556,321
b. P656,059
c. P656,321
d. P701,321

31.Unit that do not meet production standards and usually discarded are:
a. Defective units
b. Spoiled units
c. Scrap units
d. Added units

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32.Spoilage that is an inherent result of a particular production and arises even
under efficient operating condition is:
a. Normal spoilage
b. Abnormal spoilage
c. Defective units
d. Scrap units

33.What is the equivalent unit of production of lost units whicha re normally


discovered at the end of the process?
a. None
b. 100%
c. 50%
d. 80%

34.When spoiled units are discovered at the end of the process in the
subsequent department, to compute the cost of spoiled units, the number of
spoiled units multiplied by:
a. The unit costs from prior department only
b. The total unit costs from prior department and subsequent
departments
c. The unit cost in the subsequent department
d. The unit cost for materials in subsequent department

35.When materials are added in the subsequent department and the volume of
units increased, the transferred in unit costs are:
a. Increased
b. Unchanged
c. Decreased
d. Not applicable

36.Jet Company manufactures a product that passes in four departments in a


continuous process. Department 3 had no beginning work in process
inventory and transferred in 18,000 units from Department 2, each with an
equivalent unit cost of 12.50. within Department 3, unit costs for direct
materials, direct labor and manufacturing overhead (applied) were P8.00,
P9.75, and P4.00, respectively. Direct materials in Department 3 are added at
the beginning of the process. Department 3 had 4,800 units in the ending
work in process inventory which are 65% complete as to conversion costs.

If 620 units were lost in the Department 3 at Jets inspection point where
conversion costs were 45% complete, what was the total costs of lost units?
a. P11,325.22
b. P13,818.25
c. P16,546.25
d. P 8,796.25

37.Using the data in Number 36, if at Jets Department 3 inspection point, which
is at halfway through Department 3s conversion process, 1,200 spoiled units
were removed from production. Normal lost units was 800 units. If total costs
of lost units was P32,850, how much of the amount should be allocated to
ending work in process inventory?
a. P5,840.00
b. P7,320.00
c. P6,257.14
d. -0-

38.Rose Company instituted a new process in July. During the month, 10,000
units were started in Department 1. Of the units started, 1,000 were spoiled
at the end of the process, considered normal in the operation of the company.
7,000 units were transferred to Department 2 and 2,000 remained in work in

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process at July 31 which was 100% complete as to material costs and 50%
complete as to conversion costs. Material costs of P30,000 and conversion
costs of P45,000 were charged to Department 1 in July.
What were the total costs transferred out to Department 2?
a. P46,900
b. P53,600
c. P56,000
d. 57,120

39.Viagra Chemicals has a Mixing Department and a Refining Department. Its


process costing system in the Mixing Department has two direct materials
cost categories (Chemical P and Chemical Q) and one conversion costs pool.
The following data pertain to the Mixing Department for July, 2014:

Units: Work in process, July 1 0


Units started 50,000
Completed and transferred out 35,000

Costs: Chemical P P250,000


Chemical Q 70,000
Conversion costs 135,000

Chemical P is introduced at the start of operations in the Mixing Department,


and Chemical Q is added when the product is three fourths completed in the
Mixing Department. Conversion costs are added evenly during the process.
The ending work in process in the Mixing Department is two-thirds complete.

What is the cost of goods completed and transferred to the refining


Department during July?
a. P350,000
b. P400,000
c. P300,000
d. P450,000

40.Using the data in Number 39, what is the cost of work in process as of July 31,
2014?
a. P105,000
b. P120,000
c. P115,000
d. P150,000

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