29 Jun Question The Lee Company uses a job-order
Question
The Lee Company uses a job-order costing system. The following data were recorded for June:
Overhead is charged to production at 80% of direct materials cost. Jobs 235, 237, and 238 were completed during June and transferred to finished goods. Jobs 235 and 238 have been delivered to customers.
Added During June—-
Job
umber June 1Work inProcessInventory DirectMaterials Direct Labor
235 $2,500 $600 $400
236 $1,500 $800 $1,000
237 $1,000 $1,200 $1,750
238 $800 $ 1,500 $2,250
1. Lee Company’s work-in-process inventory balance on June 30 was
A. $4,100.
B. $3,300.
C. $9,450.
D. $3,940.
2. Assume there’s no beginning work-in-process inventory and the ending work-in-process inventory is 70% complete with respect to conversion costs. Under the weighted-average method, the number of equivalent units of production with respect to conversion costs would be
A. less than the units started during the period.
B. the same as the units started during the period.
C. the same as the units completed.
D. less than the units completed.
3. Becky works on the assembly line of a manufacturing company where she installs a component part for one of the company’s products. She’s paid $16 per hour for regular time, and time and a half for all work in excess of 40 hours per week. Becky’s employer offers fringe benefits that cost the company $3 for each hour of employee time (both regular and overtime). During a given week, Becky works 42 hours but is idle for 3 hours due to material shortages. The company treats all fringe benefits relating to direct labor as
added direct labor cost and the remainder as part of manufacturing overhead. The allocation of Becky’s wages and fringe benefits for the week between direct labor cost and manufacturing overhead would be
which of the following?
A. Direct Labor: $672 / Manufacturing Overhead: $142
B. Direct Labor: $688 / Manufacturing Overhead: $126
C. Direct Labor: $624 / Manufacturing Overhead: $190
D. Direct Labor: $741 / Manufacturing Overhead: $73
Use the following information to answer this question.
Abis Corporation uses the weighted-average method in its process-costing system. This month, the beginning inventory in the first processing department consisted of 800 units. The costs and percentage completion of these units in beginning inventory were
Cost Percent Complete
Material costs $6,000 50%
Conversion costs $9,900 30%
A total of 9,200 units were started, and 8,200 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month:
Cost
Material costs $113,900
Conversion costs $322,500
The ending inventory was 80% complete with respect to materials and 20% complete with respect to conversion costs.
Note: Your answers may differ from those offered below due to rounding error. In all cases, select the
answer that’s the closest to the answer you computed. To reduce rounding error, carry out all
computations to at least three decimal places.
4. The cost per equivalent unit for materials for the month in the first processing department is closest to
A. $11.39.
B. $11.99.
C. $12.44.
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