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Chapter 18: Q.18-11RQ (page 1006)

Question: Explain the terms to account for and accounted for.

Short Answer

Expert verified

Answer:

The term account for includes the amount in process at the beginning of the period plus the amount started or added during the period.

The term accounted for shows what happened to the amounts to account for. They are either still in the process or completed and transferred out.

Step by step solution

01

Meaning of ‘Account for’

Account for is explained as the aggregate of the amount balance in work in process at the beginning of the period and the amount introduced during the year and the amount started during the year.

02

Meaning of ‘Accounted for’

The accounted for explains whether the amount introduced in production process during the year is still in process or it is completed. It also explains the amount of production process transferred to other process or finished goods.

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Most popular questions from this chapter

Question: Identify each costing system characteristic as job order costing or process costing.

a. One Work-in-Process Inventory account

b. Production cost reports

c. Cost accumulated by process

d. Job cost sheets

e. Manufactures homogenous products through a series of uniform steps

f. Multiple Work-in-Process Inventory accounts

g. Costs transferred at end of period

h. Manufactures batches of unique products or provides specialized services

Describe how the FIFO method is different from the weighted-average method.

Refer to the data and your answers from Exercise E18-23.

Requirements

1. Prepare the journal entries to record the assignment of direct materials and direct labor and the allocation of manufacturing overhead to the Fermenting Department. Assume labor costs are accrued and not yet paid. Also prepare the journal entry to record the cost of the gallons completed and transferred out to the Packaging Department.

2. Post the journal entries to the Work-in-Process Inventory—Fermenting T-account. What is the ending balance?

3. What is the average cost per gallon transferred out of the Fermenting Department into the Packaging Department? Why would Shea Winery’s managers want to know this cost?

Question: Spring Fresh produces premium bottled water. Spring Fresh purchases artesian water, stores the water in large tanks, and then runs the water through two processes: filtration and bottling.

During February, the filtration process incurred the following costs in processing

200,000 liters:

Wages of workers operating filtration equipment

$34,950

Manufacturing overhead allocated to filtration

19,050

Water

110,000

Spring Fresh had no beginning Work-in-Process Inventory in the Filtration Department in February.

Requirements

1. Use the FIFO method to compute the February conversion costs in the Filtration Department.

2. The Filtration Department completely processed 200,000 liters in February. Use

the FIFO method to determine the filtration cost per liter.

Miller Company sells several products. Sales reports show that the sales volume of its most popular product has increased the past three quarters while overall profits have decreased. How might production cost reports assist management in making decisions about this product?
See all solutions

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