Chapter 18: Q1RQ (page 1005)
Question: What types of companies use job order costing systems?
Answer:
The companies that manufacture the specific or unique products in small quantities and provide specialized services to the customers or clients of the company uses the job order costing system.
Over 30 million students worldwide already upgrade their learning with Vaia!
All the tools & learning materials you need for study success - in one app.
Get started for free
Question: List ways in which job order costing systems are similar to process costing systems.
Match each costing system characteristic to job order costing, process costing, or both.
1. Used by companies that manufacture identical items through a series of uniform production steps or processes
2. Transfers costs from Work-in-Process Inventory to Finished Goods Inventory to Cost of Goods Sold
3. Used by companies that manufacture unique products or provide specialized services
4. Has multiple Work-in-Process Inventory accounts
5. Tracks direct materials, direct labor, and manufacturing overhead costs
Brian’s Frozen Pizzas uses FIFO process costing. Selected production and cost data follow for April 2018.
Prepping department | |
Units to account for: | |
Beginning work-in-process, March 31 | 20,000 |
Started in April | 45,000 |
Total units to account for | 65,000 |
Units accounted for: | |
Completed and transferred out during April: | |
From beginning work-in-process inventory | 20,000 |
Started and completed during April | 30,000 |
Ending work-in-process, April 30 | 15,000 |
Total units accounted for | 65,000 |
Requirements
1. Calculate the following:
a. On March 31, the Prepping Department beginning Work-in-Process Inventory was 75% complete for materials and 55% complete for conversion costs. This means that for the beginning inventory % of the materials and % of the conversion costs were added during April.
b. On April 30, the Prepping Department ending Work-in-Process Inventory was 60% complete for materials and 85% complete for conversion costs. This means that for the ending inventory % of the materials and % of the conversion costs were added during April.
2. Use the information in the table and the information in Requirement 1 to compute the equivalent units of production for direct materials and conversion costs for the Prepping Department.
Question: The Cutting Department has 6,500 units in process at the end of September that are 100% complete for direct materials and 85% complete for conversion costs. Calculate the equivalent units of production for direct materials and conversion costs.
Question: What are the primary differences between job order costing systems and process costing systems?
What do you think about this solution?
We value your feedback to improve our textbook solutions.
