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Process Costing
Multiple Choice

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Select the best answer to each question.

1 .       (CPA) Kew Co. had 3,000 units in work in process at April 1 of the current fiscal year, which were 60% complete as to conversion costs. During April, 10,000 units are completed. At April 30, 4,000 units remain in work in process and are 40% complete as to conversion costs. Direct materials are added at the beginning of the process. Conversion costs are added evenly throughout the process. Assuming Kew uses the weighted-average method, how many units were started during April? 



2 .       (CPA) Under which of the following conditions will the first-in, first-out method of process costing yield the same equivalent unit costs as the weighted-average method? 



3 .       (CPA) Walton, Incorporated, had 8,000 units of work in process in Department A on October 1 of the current fiscal year. These units were 60% complete as to conversion costs, which are added evenly throughout the process. Direct materials are added at the beginning of the process. During October, 34,000 units are started and 36,000 units completed. Walton has 6,000 units of work in process on October 31. These units are 80% complete as to conversion costs. For October, how much did the equivalent units under the weighted-average method exceed the equivalent units under the first-in, first-out method?

Direct Materials / Conversion Costs  



4 .       Under the standard-costing method, how (if at all) are equivalent units used in the computations for process costing? 



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