361-Chapter-6-MC-Solutions

Chapter6—ProcessCostingMULTIPLECHOICE1.Whichcostaccumulationprocedureismostapplicableincontinuousmass-productionmanufacturingenvironments?a.standardb.actualc.processd.joborderANS:CPTS:1DIF:EasyOBJ:6-1NAT:AACSB:ReflectiveThinkingLOC:AICPAFunctionalCompetencies:Measurement,Reporting2.Processcostingisusedincompaniesthata.engageinroadandbridgeconstruction.b.producesailboatsmadetocustomerspecifications.c.producebricksforsaletothepublic.d.constructhousesaccordingtocustomerplans.ANS:CPTS:1DIF:EasyOBJ:6-1NAT:AACSB:ReflectiveThinkingLOC:AICPAFunctionalCompetencies:Measurement,Reporting3.Aproducerof____wouldnotuseaprocesscostingsystem.a.gasolineb.potatochipsc.blankvideotapesd.stainedglasswindowsANS:DPTS:1DIF:EasyOBJ:6-1NAT:AACSB:ReflectiveThinkingLOC:AICPAFunctionalCompetencies:Measurement,ReportingChapter624.Aprocesscostingsystemisusedbyacompanythata.producesheterogeneousproducts.b.producesitemsbyspecialrequestofcustomers.c.produceshomogeneousproducts.d.accumulatescostsbyjob.ANS:CPTS:1DIF:EasyOBJ:6-1NAT:AACSB:ReflectiveThinkingLOC:AICPAFunctionalCompetencies:Measurement,Reporting5.Whichisthebestcostaccumulationproceduretouseforcontinuousmassproductionoflikeunits?a.actualb.standardc.joborderd.processANS:DPTS:1DIF:EasyOBJ:6-1NAT:AACSB:ReflectiveThinkingLOC:AICPAFunctionalCompetencies:Measurement,Reporting6.Equivalentunitsofproductionareequaltothea.unitscompletedbyaproductiondepartmentintheperiod.b.numberofunitsworkedonduringtheperiodbyaproductiondepartment.c.numberofwholeunitsthatcouldhavebeencompletedifallworkoftheperiodhadbeenusedtoproducewholeunits.d.identifiableunitsexistingattheendoftheperiodinaproductiondepartment.ANS:CPTS:1DIF:ModerateOBJ:6-2NAT:AACSB:ReflectiveThinkingLOC:AICPAFunctionalCompetencies:Measurement,Reporting7.Inaprocesscostingsystemusingtheweightedaveragemethod,costperequivalentunitforagivencostcomponentisfoundbydividingwhichofthefollowingbyEUP?a.onlycurrentperiodcostb.currentperiodcostplusthecostofbeginninginventoryc.currentperiodcostlessthecostofbeginninginventoryd.currentperiodcostplusthecostofendinginventoryANS:BPTS:1DIF:EasyOBJ:6-2NAT:AACSB:ReflectiveThinkingLOC:AICPAFunctionalCompetencies:Measurement,Reporting8.TheweightedaveragemethodisthoughtbysomeaccountantstobeinferiortotheFIFOmethodbecauseita.ismoredifficulttoapply.b.onlyconsidersthelastunitsworkedon.c.ignoresworkperformedinsubsequentperiods.d.comminglescostsoftwoperiods.ANS:DPTS:1DIF:ModerateOBJ:6-3NAT:AACSB:ReflectiveThinkingLOC:AICPAFunctionalCompetencies:Measurement,ReportingChapter639.ThefirststepindeterminingthecostperEUPpercostcomponentundertheweightedaveragemethodistoa.addthebeginningWorkinProcessInventorycosttothecurrentperiod'sproductioncost.b.dividethecurrentperiod'sproductioncostbytheequivalentunits.c.subtractthebeginningWorkinProcessInventorycostfromthecurrentperiod'sproductioncost.d.dividethecurrentperiod'sproductioncostintotheEUP.ANS:APTS:1DIF:ModerateOBJ:6-3NAT:AACSB:ReflectiveThinkingLOC:AICPAFunctionalCompetencies:Measurement,Reporting10.ThedifferencebetweenEUPcalculatedusingFIFOandEUPcalculatedusingweightedaverageistheequivalentunitsa.startedandcompletedduringtheperiod.b.residinginbeginningWorkinProcessInventory.c.residinginendingWorkinProcessInventory.d.uncompletedinWorkinProcessInventory.ANS:BPTS:1DIF:ModerateOBJ:6-3NAT:AACSB:ReflectiveThinkingLOC:AICPAFunctionalCompetencies:Measurement,Reporting11.EUPcalculationsforstandardprocesscostingarethesameasa.theEUPcalculationsforweightedaverageprocesscosting.b.theEUPcalculationsforFIFOprocesscosting.c.LIFOinventorycostingformerchandise.d.theEUPcalculationsforLIFOprocesscosting.ANS:BPTS:1DIF:ModerateOBJ:6-5NAT:AACSB:ReflectiveThinkingLOC:AICPAFunctionalCompetencies:Measurement,Reporting12.InaFIFOprocesscostingsystem,whichofthefollowingareassumedtobecompletedfirstinthecurrentperiod?a.unitsstartedthisperiodb.unitsstartedlastperiodc.unitstransferredoutd.unitsstillinprocessANS:BPTS:1DIF:EasyOBJ:6-4NAT:AACSB:ReflectiveThinkingLOC:AICPAFunctionalCompetencies:Measurement,Reporting13.TocomputeequivalentunitsofproductionusingtheFIFOmethodofprocesscosting,workforthecurrentperiodmustbestatedinunitsa.completedduringtheperiodandunitsinendinginventory.b.completedfrombeginninginventory,unitsstartedandcompletedduringtheperiod,andunitspartiallycompletedinendinginventory.c.startedduringtheperiodandunitstransferredoutduringtheperiod.d.processedduringtheperiodandunitscompletedduringtheperiod.ANS:BPTS:1DIF:ModerateOBJ:6-4NAT:AACSB:ReflectiveThinkingLOC:AICPAFunctionalCompetencies:Measurement,ReportingChapter6414.TheFIFOmethodofprocesscostingwillproducethesamecostofgoodstransferredoutamountastheweightedaveragemethodwhena.thegoodsproducedarehomogeneous.b.thereisnobeginningWorkinProcessInventory.c.thereisnoendingWorkinProcessInventory.d.beginningandendingWorkinProcessInventoriesareeach50percentcomplete.ANS:BPTS:1DIF:EasyOBJ:6-4NAT:AACSB:ReflectiveThinkingLOC:AICPAFunctionalCompetencies:Measurement,Reporting15.TheprimarydifferencebetweentheFIFOandweightedaveragemethodsofprocesscostingisa.inthetreat