Managerial Accounting (5th Edition)
5th Edition
ISBN: 9780134128528
Author: Karen W. Braun, Wendy M. Tietz
Publisher: PEARSON
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Textbook Question
Chapter 5, Problem 5.27AE
Continuation of E5-26A: Journal entries (Learning Objective 4)
Return to the Blending Department for the Color World Paint Company in E5-26A,
Requirements
- 1. Prepare the
journal entry to record the use of direct materials and direct labor and the allocation of manufacturingoverhead to the Blending Department. Also, give the journal entry to record the costs of the gallons completed and transferred out to the Packaging Department. Assume the wages are unpaid. - 2.
Post the journal entries to the Work in Process Inventory—Blending T-account. What is the ending balance?
Expert Solution & Answer
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Check out a sample textbook solutionStudents have asked these similar questions
Click to watch the Tell Me More Learning Objective 2 video and then answer the questions below.
1. The first step in preparing a cost of production report is to _____.
compute equivalent units of production
determine the units to be assigned costs
determine the cost per equivalent unit
allocate costs to units transferred out and partially completed units
2. The last step in preparing a cost of production report is to _____.
compute equivalent units of production
determine the units to be assigned costs
determine the cost per equivalent unit
allocate costs to units transferred out and partially completed units
Click to watch the Tell Me More Learning Objective 4 video and then answer the questions below.
1. Which of the following represents the computation of direct materials cost per equivalent unit?
Total direct cost for the period divided by total equivalent units of direct materials.
Total equivalent units of direct materials divided by total direct cost for the period.
Total direct cost for the period divided by total units of direct materials.
Total units of direct materials divided by total direct cost for the period.
2. What is the conversion cost per equivalent unit, when the total conversion cost for the period is $1,225 and the total units of packaged drinking water produced during the same period is 5,000 gallons (70 percent complete).
$0.17 per gallon
$0.35 per gallon
$2.86 per gallon
None of these choices are correct.
Click to watch the Tell Me More Learning Objective 3 video and then answer the questions below.
1. The journal entry to recognize depreciation on machinery is ________.
a debit to Factory Overhead and a credit to Accumulated Depreciation
a debit to Accumulated Depreciation and a credit to Factory Overhead
a debit to Factory Overhead and a credit to Depreciation Expense
a debit to Depreciation Expense and a credit to Factory Overhead
2. Process and job order cost systems are similar in ________ manner.
recording and summarizing product costs
classifying product costs as direct materials, direct labor, and factory overhead
allocating factory overhead costs to products
All of these choices are correct.
Chapter 5 Solutions
Managerial Accounting (5th Edition)
Ch. 5 - (Learning Objective 1) Which of the following is...Ch. 5 - (Learning Objective 2) Conversion costs consist of...Ch. 5 - (Learning Objective 2) Which of the following is...Ch. 5 - (Learning Objective 3) Which of the following is...Ch. 5 - Prob. 5QCCh. 5 - (Learning Objective 4) The journal entry needed to...Ch. 5 - (Learning Objective 4) A company has two...Ch. 5 - Prob. 8QCCh. 5 - Prob. 9QCCh. 5 - Prob. 10QC
Ch. 5 - Compare job costing and process costing (Learning...Ch. 5 - Prob. 5.2SECh. 5 - Prob. 5.3SECh. 5 - Determine the physical flow of units (process...Ch. 5 - Compute equivalent units (process costing Step 2)...Ch. 5 - Compute equivalent units (process costing Step 2)...Ch. 5 - Summarize total costs to account for (process...Ch. 5 - Prob. 5.8SECh. 5 - Prob. 5.9SECh. 5 - Prob. 5.10SECh. 5 - Prob. 5.11SECh. 5 - Prob. 5.12SECh. 5 - Prob. 5.13SECh. 5 - Prob. 5.14SECh. 5 - Prob. 5.15SECh. 5 - Prob. 5.16SECh. 5 - Continuation of S5-16: Record journal entry and...Ch. 5 - Compute equivalent units in second department...Ch. 5 - Prob. 5.19SECh. 5 - Prob. 5.20SECh. 5 - Prob. 5.21SECh. 5 - Prob. 5.22SECh. 5 - Analyze flow of costs through inventory T-accounts...Ch. 5 - Summarize physical units and compute equivalent...Ch. 5 - Prob. 5.25AECh. 5 - Prob. 5.26AECh. 5 - Continuation of E5-26A: Journal entries (Learning...Ch. 5 - Complete the production cost report in first...Ch. 5 - Prob. 5.29AECh. 5 - Analyze costs and gross profit in a process...Ch. 5 - Prob. 5.31AECh. 5 - Compute equivalent units and assign costs...Ch. 5 - Complete five-step procedure in first department...Ch. 5 - Sustainability and process costing (Learning...Ch. 5 - Complete five-step procedure and journalize result...Ch. 5 - Complete five-step procedure in second department...Ch. 5 - Exercises Group B E5-37B Analyze flow of costs...Ch. 5 - Summarize physical units and compute equivalent...Ch. 5 - Prob. 5.39BECh. 5 - Complete five-step procedure in first department...Ch. 5 - Prob. 5.41BECh. 5 - Prob. 5.42BECh. 5 - Prob. 5.43BECh. 5 - Prob. 5.44BECh. 5 - Record journal entries (Learning Objective 4)...Ch. 5 - Compute equivalent units and assign costs...Ch. 5 - Prob. 5.47BECh. 5 - Sustainability and process costing (Learning...Ch. 5 - Complete five-step procedure and journalize result...Ch. 5 - Complete five-step procedure in second department...Ch. 5 - Process costing in a single processing department...Ch. 5 - Process costing in a first department (Learning...Ch. 5 - Prob. 5.53APCh. 5 - Prepare a production cost report and journal...Ch. 5 - Prob. 5.55APCh. 5 - Process costing in a single processing department...Ch. 5 - Process costing in a first department (Learning...Ch. 5 - Prob. 5.58BPCh. 5 - Prepare a production cost report and journal...Ch. 5 - Prob. 5.60BPCh. 5 - Prob. 5.61SCCh. 5 - Discussion Questions 1. What characteristics of...Ch. 5 - Prob. 5.63ACTCh. 5 - Prob. 5.64ACTCh. 5 - Process costing and hybrid costing issues...
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- Click to watch the Tell Me More Learning Objective 1 video and then answer the questions below. 1. Which of the following manufacturers is most likely to use a process cost system? Purse manufacturer Sports drink manufacturer Automobile manufacturer Guitar manufacturer 2. Process and job order cost systems are similar in that both systems _______. record and summarize product costs classify product costs as direct materials, direct labor, and factory overhead allocate factory overhead costs to products All of these choices are correct.arrow_forwardActivity-Based Costing, Lean Operations, and the Costs of Quality E4-24A Compare traditional and ABC allocations on a job (Learning Objective 2) Radley Products has adopted an ABC costing system. The following manufacturing activi- ties, indirect manufacturing costs, and cost drivers have been identified: Activity Machine setup Total estimated MOH costs related to activity Total estimated amount of allocation base activity $ 120,000 $1,050,000 Machining Polishing Quality control Facility-level costs sdngas 000' 6,000 machine hours 10,000 polishing cloths 4,000 tests run 50,000 DL hours 000'08 $ 280,000 $ 120.000 Total manufacturing overhead (MOH) $1.650.000 The Job Cost Record for Job #624 revealed that direct materials requisitioned for the job totaled $1,050. The Job Cost Record also showed that direct labor for this job totaled 10 hours at a wage rate of 525 per hour. Other data collected on the resources used by Job #624 included: 1 machine setup required 5 machine hours 2…arrow_forwardS18-13 Preparing journal entry Learning Objective 5 The Mixing Department's production cost report for May shows $12,500 in total costs, of which $2,500 will remain in the department assigned to the units still in process at the end of the month. Prepare the journal entry to record the transfer of costs from the Mixing Department to the Packaging Department.arrow_forward
- Calculate a job cost using ABC (Learning Objective 2)Oliver Industries, a small, family-run manufacturer, has adopted an ABC system . The fol- lowing manufacturing activities, indirect manufacturing costs, and usage of cost drivers have been estimated for the year :54-7Direct materials ................................................................................ ? Direct labor ...................................................................................... ? Manufacturing overhead ...... .......... .......... ............. ................. .......... ? Total job cost .................................................................................... $?Classifying costs within the cost hierarchy (Learning Objective 2) Classify each of the following costs as either unit-level, batch-level, product-level, orfacility-level.a. Engineering costs for new productb. Order processingc. Depreciation on factoryd. Direct labore. Shipment of an order to a customerf. Product line manager…arrow_forwardLearning Objectives 2, 3, 4 1. Total EUP for CC 2,850 3. WIP Balance $1,145 P18-31A Preparing a production cost report, two materials added at different points, no beginning WIP or costs transferred in; journal entries Smith's Exteriors produces exterior siding for homes. The Preparation Department begins with wood, which is chopped into small bits. At the end of the process, an adhesive is added. Then the wood/adhesive mixture goes on to the Compression Department, where the wood is compressed into sheets. Conversion costs are added evenly throughout the preparation process. January data for the Preparation Department are as follows: UNITS Beginning Work-in-Process Inventory Started in production Completed and transferred out to Compression in January Ending Work-in-Process inventory (30% of the way through the preparation process) COSTS Beginning Work-in-Process Inventory Costs added during January Wood Adhesives Direct labor Manufacturing overhead allocated Total costs Requirements…arrow_forwardLearning Objectives 2, 3, 4 1. Total cost per EUP $2.26 3. WIP Balance $1,836 Open with P18-38B Preparing a production cost report, two materials added at different points, no beginning WIP or costs transferred in; journal entries Bryan's Exteriors produces exterior siding for homes. The Preparation Department begins with wood, which is chopped into small bits. At the end of the process, an adhesive is added. Then the wood/adhesive mixture goes on to the Compression Department, where the wood is compressed into sheets. Conversion costs are added evenly throughout the preparation process. January data for the Preparation Department are as follows: UNITS Beginning Work-in-Process Inventory Started in production Completed and transferred out to Compression in January Ending Work-in-Process inventory (35% of the way through the preparation process) COSTS Beginning Work-in-Process Inventory Costs added during January: Wood Adhesives Direct labor Manufacturing overhead allocated Total costs…arrow_forward
- E18-17 Comparing job order costing versus process costing Learning Objective 1 For each of the following products or services, indicate if the cost would most likely be determined using a job order costing system or a process costing system. a. Soft drinks b. Automobile repairs c. Customized furniture d. Aluminum foil e. Lawn chairs f. Chocolate candy bars g. Hospital surgery h. Pencilsarrow_forwardE4-23A Use ABC to allocate manufacturing overhead (Learning Objective 2) Several years after reengineering its production process, Biltmore Corporation hired a new controller, Rachael Johnson. She developed an ABC system very similar to the one used by Biltmore’s chief rival, Westriver. Part of the reason Johnson developed the ABC system was because Biltmore’s profits had been declining even though the company had shifted its product mix toward the product that had appeared most profitable under the old system. Before adopting the new ABC system, Biltmore had used a plantwide overhead rate based on direct labor hours that was developed years ago. For the upcoming year, Biltmore’s budgeted ABC manufacturing overhead allocation rates are as follows: Activity Allocation Base Activity Cost Allocation Rate Materials handling # of parts $3.84 per part Machine setup # of setups $330.00 per setup Insertion of parts # of parts $30.00 per part Finishing Finishing DL hrs $54.00 per hour The…arrow_forwardS18-1 Comparing job order costing versus process costing Learning Objective 1 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 servicesarrow_forward
- S5-13 Find unit cost and gross profit on a final product (Learning Objective 5) Counter Co. produces Formica countertops in two sequential production departments: Forming and Polishing. The Polishing Department calculated the following costs per equivalent unit (square feet) on its October production cost report: Transferred-in $2.44 Direct Materials Conversion Costs $0.40 $1.66 Cost per equivalent unit: During October, 165,000 square feet were completed and transferred out of the Polishing Department to Finished Goods Inventory. The countertops were subsequently sold for $13.00 per square foot. 1. What was the cost per square foot of the finished product? 2. Did most of the production cost occur in the Forming Department or in the Polishing Department? Explain how you can tell where the most production cost occurred. 3. What was the gross profit per square foot? 4. What was the total gross profit on the countertops produced in October?arrow_forward(ACADEMIC) E-LEARNING SERVICES SQU LIBRARIES SQU PORTALATTENDANCE urses / ACCT2121_yasserg_Spring21 / Midterm Exam One / Midterm Exam One Time left 1:49:27 Which of the following is correct with respect to closing out overapplied manufacturing overhead to Cost of Goods Sold versus closing it out to Work-in-Process Inventory, Finished Goods Inventory, and Cost of Goods Sold? None of given answer is correct. O a. O b. The balance in the Work-in-Process account after allocation will be the same under either method. O C. Cost of Goods Sold will be lower if the overapplied overhead is closed out by allocating it to the inventory accounts as well as to Cost of Goods Sold. O d. The balance in the Work-in-Process account after allocation will be higher if the overapplied overhead is closed out by allocating it to all appropriate accounts. e. Operating income will be higher if all the overapplied overhead is closed out to Cost of Goods Sold. The total conversion cost for company XYZ was five…arrow_forward$4-3 Compute departmental overhead rates (Learning Objective 1) Snyder Snacks makes potato chips, corn chips, and cheese puffs using three different pro- du es wi the same manufacturing plant. Currently, Snyder uses a single plant- wide overhead rate to allocate its $3,311,500 of annual manufacturing overhead. Of this amount, $2,070,000 is associated with the potato chip line, $763,000 is associated with the corn chip line, and $478,500 is associated with the cheese puff line. Snyder's plant is currently running a total of 17,900 machine hours: 11,500 in the potato chip line, 3,500 in the corn chip line, and 2,900 in the cheese puff line. Snyder considers machine hours to be the cost driver of manufacturing overhead costs. 1. What is Snyder's plantwide overhead rate? 2. Calculate the departmental overhead rates for Snyder's three production lines. Round all answers to the nearest cent. 3. Which products have been overcosted by the plantwide rate? Which products have been undercosted by…arrow_forward
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