Azucar, Inc. has six processing departments for refining sugar-Affination, Carbonation, Decolorization, Boiling, Recovery, and Packaging. Conversion costs are added evenly throughout each process. Data from August for the Decolorization Department are as follows:
___________________________________________ Metric Tons
Beginning Work-in-Process Inventory ........................... 0
Transferred in ................................................ 13,500
Completed and transferred out to Boiling in August ...... 5500
Ending Work-in-Process Inventory .......................... 8000
_______________________________________ Costs
Beginning Work-in-Process Inventory ................ $0
Costs added during August ................................
Direct materials .................................. 3,000,000
Direct labor ....................................... 1,100,000
Manufacturing overhead ......................... 625,000
Total costs added during August ............ $4,725,000
1. The ending Work-in-Process Inventory is 100% and 75% complete with respect to direct materials and conversion costs, respectively. The weighted-average method is used. Compute the cost per equivalent unit for direct materials and conversion costs. (Round any intermediate calculations and your final answer to two decimal places.)
a. $81.48 per metric ton for direct materials; $200.00 per metric ton for conversion costs.
b. $200.00 per metric ton for direct materials; $81.48 per metric ton for conversion costs.
c. $222.22 per metric ton for direct materials; $150.00 per metric ton for conversion costs.
d. $222.22 per metric ton for direct materials; $222.22 per metric ton for conversion costs.
2. Martinez Manufacturing incurred $4000 for indirect labor in Department III. The journal entry to record indirect labor utilized, but not paid is ________. Process costing is used.
a. Debit Manufacturing Overhead, $4000; credit Wages Payable, $4000
b. Debit Wages Payable, $4000; credit Manufacturing Overhead, $4000
c. Debit Accounts Payable, $4000; credit Manufacturing Overhead, $4000
d. Debit Manufacturing Overhead, $4000; credit Accounts Payable, $4000
3. The managerial role that involves the day-to-day running of the business is the ________.
a. Strategic planning function
b. Directing function
c. Planning function
d. Controlling function
4. Manufacturing costs flow from Work-in-Process Inventory to Cost of Goods Sold to Finished Goods Inventory.
a. True
b. False
5. Payton Corporation provided the following information for the year:
Beginning Balance-Work-in-Process Inventory ..................... $26,000
Ending Balance-Work-in-Process Inventory ........................... 55,000
Beginning Balance- Direct Materials ................................... 81,000
Ending Balance- Direct Materials ....................................... 59,000
Purchases - Direct Materials ........................................... 360,000
Direct Labor ................................................................ 471,000
Indirect Labor ............................................................... 19,000
Depreciation on Factory Plant and Equipment ......................... 24,000
Plant Utilities and Insurance ............................................. 268,000
6. What was the amount of the cost of goods manufactured for the year?
a. $1,363,000
b. $1,164,000
c. $1,193,000
d. $1,135,000