Chapter 8 Process Costing Cost Acctg

Question 0

Measure the physical flow of resources

Answer 0

Begin wip + units started = units transferred out+end wip

Question 1

In process industry, what are the steps to product costing?

Answer 1

Messier physical flow of resources, compute equivalent units of production, identify product costs to account for, compute costs per equivalent unit, and assign product cost to batches of work

Question 2

How to overstate income with Wip

Answer 2

Overstating completion of ending inventory in process costing assigns more costs to ending inventory and less costs to goods transferred out of wip. Understating cost of goods in transferred out of wip also understates cogs when those goods are sold.

Question 3

Weighted average process costing

Answer 3

Inventory method that for product costing purposes combines costs and equivalent units of it. But the costs and the equivalent units in beginning inventory

=wip costs + current period costs/wip eu + current period eu

Question 4

First in first out process costing

Answer 4

Inventory method whereby the first goods received are the first ones charged out when sold or transferred

=current period costs/current period eu