41. In a process cost system, the number of units started and completed for a period is equal to:
A. Units transferred out less units in beginning work in process.
B. Units transferred out less units in ending work in process.
C. Units transferred out plus units of beginning work in process.
D. Units transferred out plus units in ending work in process.
42. The number of equivalent full units of production:
A. Is equal to the number of units completed by a department.
B. May not be greater than the number of units completed by a department.
C. Is used to complete the overhead application rate.
D. May be less than, equal to, or greater than the number of physical units completed during the period.
43. Equivalent full units of production represent units of:
A. Finished goods inventory.
B. Units of work-in-process inventory.
C. Work performed during the period.
D. Sales generated during the period.
44. Companies that compute equivalent full units of production do so to:
A. Comply with income tax regulations.
B. Compute total manufacturing costs for the period.
C. Determine a manufacturing overhead application rate.
D. Determine departmental per-unit costs.
45. The computation of equivalent full units is generally not necessary when:
A. Beginning work-in-process inventories are significantly larger than ending work-in-process inventories.
B. Beginning and ending work-in-process inventories differ only slightly.
C. The number of units in ending work-in-process exceeds the number of units completed and transferred to finished goods during the period.
D. Per-unit costs become distorted as a result of not computing equivalent full units of production.
Use the following to answer questions 46-49:
Sue's Soup Products uses a process cost system with two processing departments: the Mixing Department and the Canning Department. Work-in-process inventories are reduced to zero each month. In March, the Mixing Department incurred manufacturing costs of $63,000 to mix 42,000 gallons of soup. The Canning Department incurred manufacturing costs of $9,000. A total of 170,000 cans of soup were transferred to the finished goods warehouse during the month.
46. Refer to the information above. The journal entry to record the transfer of soup out of the Mixing Department during March would include:
A. A debit to Work-in-Process Inventory, Mixing Department of $63,000.
B. A credit to Work-in-Process Inventory, Canning Department of $72,000.
C. A debit to Finished Goods Inventory of $72,000.
D. A credit to Work-in-Process Inventory, Mixing Department of $63,000.
47. Refer to the information above. The journal entry to record the transfer of soup out of the Canning Department during March would include:
A. A credit to Work-in-Process Inventory, Canning Department of $9,000.
B. A credit to Work-in-Process Inventory, Canning Department of $63,000.
C. A debit to Finished Goods Inventory of $72,000.
D. A credit to Finished Goods Inventory, Mixing Department of $72,000.
48. Refer to the information above. The unit cost per gallon of soup transferred to the Canning Department during March was:
A. $1.50.
B. $1.62.
C. $1.71.
D. $1.83
49. Refer to the information above. The unit cost per can of soup transferred to the finished goods warehouse during March was:
A. $0.05.
B. $0.42.
C. $0.37.
D. $1.71.
Use the following to answer questions 50-52:
Evans Products uses a process cost system with two processing departments: the Mixing Department and the Finishing Department. In June, unit costs incurred by the Mixing Department amounted to $4.00 per unit. Unit costs transferred to the finished goods warehouse during the month amounted to $22. Work-in-process inventories are reduced to zero each month.
50. Refer to the information above. The transfer of 35,000 units of paint to the Finishing Department in June required:
A. A debit to Finished Goods Inventory of $770,000.
B. A credit to Work-in-Process Inventory, Mixing Department of $770,000.
C. A credit to Work-in-Process Inventory, Finishing Department of $140,000.
D. A debit to Work-in-Process Inventory, Finishing Department of $140,000.