ACG 2071 EXAM 2 PRACTICE SOLUTION
STUDY SHEET QUESTIONS AND DETAILED
ANSWERS
●● job order costing, process costing, or both?
Transfers costs from Work-in-Process Inventory to Finished Goods
Inventory to Cost of Goods Sold
Answer: both
●● job order costing, process costing, or both
Used by companies that manufacture unique products or provide
specialized services
Answer: Job order costing
●● job order costing, process costing, or both
Answer:
●● job order costing, process costing, or both
Answer:
,●● Which characteristic is the same in both job order costing systems
and process costing systems?
A. Method of record keeping
B. Flow of costs through the accounts
C. Number of Work-in-Process Inventory accounts
D. Types of product costs
Answer: D. Types of product costs
●● Conversion costs
Answer: The cost to convert direct materials (DM) into finished goods
direct labor (DL) + manufacturing overhead (MOH)
●● In process costing, production costs are _________ by process
Answer: accumulated
●● (Process Costing) At the end of the period, the total production costs
incurred must be split between the following:
, Answer: - The units that have been completed in that process and
transferred to the next process (or to Finished Goods Inventory if it is the
last process).
- The units not completed and remaining in Work-in-Process Inventory
for that department.
●● equivalent units of production (EUP)
Answer: Used to measure the direct materials, direct labor, and
manufacturing overhead incurred on partially completed units and
expressed in terms of fully completed units.
allows businesses to measure the amount of materials added to or work
done on a partially finished group of units during a period and to express
it in terms of fully complete units of output.
●● Predetermined overhead allocation rate
Answer: Estimated overhead cost per unit of the allocation base,
calculated at the beginning of the accounting period. Total estimated
overhead costs / Total estimated quantity of the overhead allocation
base.
●● FIFO method (process costing)
STUDY SHEET QUESTIONS AND DETAILED
ANSWERS
●● job order costing, process costing, or both?
Transfers costs from Work-in-Process Inventory to Finished Goods
Inventory to Cost of Goods Sold
Answer: both
●● job order costing, process costing, or both
Used by companies that manufacture unique products or provide
specialized services
Answer: Job order costing
●● job order costing, process costing, or both
Answer:
●● job order costing, process costing, or both
Answer:
,●● Which characteristic is the same in both job order costing systems
and process costing systems?
A. Method of record keeping
B. Flow of costs through the accounts
C. Number of Work-in-Process Inventory accounts
D. Types of product costs
Answer: D. Types of product costs
●● Conversion costs
Answer: The cost to convert direct materials (DM) into finished goods
direct labor (DL) + manufacturing overhead (MOH)
●● In process costing, production costs are _________ by process
Answer: accumulated
●● (Process Costing) At the end of the period, the total production costs
incurred must be split between the following:
, Answer: - The units that have been completed in that process and
transferred to the next process (or to Finished Goods Inventory if it is the
last process).
- The units not completed and remaining in Work-in-Process Inventory
for that department.
●● equivalent units of production (EUP)
Answer: Used to measure the direct materials, direct labor, and
manufacturing overhead incurred on partially completed units and
expressed in terms of fully completed units.
allows businesses to measure the amount of materials added to or work
done on a partially finished group of units during a period and to express
it in terms of fully complete units of output.
●● Predetermined overhead allocation rate
Answer: Estimated overhead cost per unit of the allocation base,
calculated at the beginning of the accounting period. Total estimated
overhead costs / Total estimated quantity of the overhead allocation
base.
●● FIFO method (process costing)
