A reason(s) why "pure" FIFO is rarely encountered in process costing is that

ACCOUNTING

Multiple Choice

A reason(s) why "pure" FIFO is rarely encountered in process costing is that

a. FIFO is usually applied within a department to compile the cost of units transferred out.

b. the units transferred into the department during a given time period are usually carried at a single average unit cost.

c. tracking costs on a “pure" FIFO basis is very difficult.

d. all of the above are reasons.

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What is the cost of the goods transferred out during February

ACCOUNTING

Multiple Choice

The Rest-a-Lot chair company manufacturers a standard recliner. During February, the firm's Assembly Department started production of 75,000 chairs. During the month, the firm completed 80,000 chairs, and transferred them to the Finishing Department. The firm ended the month with 10,000 chairs in ending inventory. There were 15,000 chairs in beginning inventory. All direct materials costs are added at the beginning of the production cycle and conversion costs are added uniformly throughout the production process. The FIFO method of process costing is used by Rest-a-Lot. Beginning work in process was 30% complete as to conversion costs, while ending work in process was 80% complete as to conversion costs.

Beginning inventory:

Direct materials $24,000

Conversion costs $35,000



Manufacturing costs added during the accounting period:

Direct materials $168,000

Conversion costs $278,000



What is the cost of the goods transferred out during February?

a. $417,750

b. $456,015

c. $476,750

d. $505,000

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What is the amount of direct materials cost assigned to ending work-in-process inventory at the end of February

ACCOUNTING

Multiple Choice

The Rest-a-Lot chair company manufacturers a standard recliner. During February, the firm's Assembly Department started production of 75,000 chairs. During the month, the firm completed 80,000 chairs, and transferred them to the Finishing Department. The firm ended the month with 10,000 chairs in ending inventory. There were 15,000 chairs in beginning inventory. All direct materials costs are added at the beginning of the production cycle and conversion costs are added uniformly throughout the production process. The FIFO method of process costing is used by Rest-a-Lot. Beginning work in process was 30% complete as to conversion costs, while ending work in process was 80% complete as to conversion costs.

Beginning inventory:

Direct materials $24,000

Conversion costs $35,000



Manufacturing costs added during the accounting period:

Direct materials $168,000

Conversion costs $278,000



What is the amount of direct materials cost assigned to ending work-in-process inventory at the end of February?

a. $19,200

b. $22,400

c. $25,600

d. $22,500

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What were the equivalent units for conversion costs during February

ACCOUNTING

Multiple Choice

The Rest-a-Lot chair company manufacturers a standard recliner. During February, the firm's Assembly Department started production of 75,000 chairs. During the month, the firm completed 80,000 chairs, and transferred them to the Finishing Department. The firm ended the month with 10,000 chairs in ending inventory. There were 15,000 chairs in beginning inventory. All direct materials costs are added at the beginning of the production cycle and conversion costs are added uniformly throughout the production process. The FIFO method of process costing is used by Rest-a-Lot. Beginning work in process was 30% complete as to conversion costs, while ending work in process was 80% complete as to conversion costs.

Beginning inventory:

Direct materials $24,000

Conversion costs $35,000



Manufacturing costs added during the accounting period:

Direct materials $168,000

Conversion costs $278,000



What were the equivalent units for conversion costs during February?

a. 83,500

b. 85,000

c. 75,000

d. 79,500

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How many of the units that were started during February were completed during February

ACCOUNTING

Multiple Choice

The Rest-a-Lot chair company manufacturers a standard recliner. During February, the firm's Assembly Department started production of 75,000 chairs. During the month, the firm completed 80,000 chairs, and transferred them to the Finishing Department. The firm ended the month with 10,000 chairs in ending inventory. There were 15,000 chairs in beginning inventory. All direct materials costs are added at the beginning of the production cycle and conversion costs are added uniformly throughout the production process. The FIFO method of process costing is used by Rest-a-Lot. Beginning work in process was 30% complete as to conversion costs, while ending work in process was 80% complete as to conversion costs.



Beginning inventory:

Direct materials $24,000

Conversion costs $35,000



Manufacturing costs added during the accounting period:

Direct materials $168,000

Conversion costs $278,000



How many of the units that were started during February were completed during February?

a. 85,000

b. 80,000

c. 75,000

d. 65,000

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An assumption of the FIFO process-costing method is that

ACCOUNTING

Multiple Choice

An assumption of the FIFO process-costing method is that

a. the units in beginning inventory are not necessarily assumed to be completed by the end of the period.

b. the units in beginning inventory are assumed to be completed first.

c. ending inventory will always be completed in the next accounting period.

d. no calculation of conversion costs is possible.

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On occasion, the FIFO and the weighted-average methods of process costing will result in the same dollar amount of costs being transferred to the next

ACCOUNTING

Multiple Choice

On occasion, the FIFO and the weighted-average methods of process costing will result in the same dollar amount of costs being transferred to the next department. Which of the following scenarios would have that result?

a. When the beginning and ending inventories are equal in terms of unit numbers.

b. When the beginning and ending inventories are equal in terms of the percentage of completion for both direct materials, and conversion costs.

c. When there is no ending inventory.

d. When there is no beginning inventory.

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