Ch 18 Key terms

Question 1

Equivalent Units

Answer 1

derived measure of output calculated by (1) taking the quantity of each input (factor of production) in units completed and in incomplete units of work in process and (2) converting the quantity of input into the amount of completed output units that could be produced with that quantity of input.

Question 2

Weighted-average process-costing method

Answer 2

calculates the cost per equivalent unit of all work done to date (regardless of the accounting period in which it was done) and assigns this cost to equivalent units completed and transferred out of the process and to equivalent units in ending work-in-process inventory.

Question 3

FIFO process-costing method

Answer 3

(1) assigns the cost of the previous accounting period’s equivalent units in beginning work-in-process inventory to the first units completed and transferred out of the process and (2) assigns the cost of equivalent units worked on during the current period first to complete the beginning inventory, next to start and complete new units, and finally to units in ending work-in-process inventory

Question 4

Transferred-in costs (previous-department costs)

Answer 4

costs incurred in previous departments that are carried forward as the product’s costs when it moves to a subsequent process in the production cycle

Question 5

hybrid-costing system

Answer 5

blends characteristics from both job-costing and process-costing systems

Question 6

operation

Answer 6

standardized method or technique performed repetitively, often on different materials, resulting in different finished goods

Question 7

operation-costing system

Answer 7

hybrid-costing system applied to batches of similar, but not identical, products. Each batch of products is often a variation of a single design, and it proceeds through a sequence of operations. Within each operation, all product units are treated exactly alike, using identical amounts of the operation’s resources