inventory similar to Self-Study Problem 2 Roberts Corporation uses a process cost system. The records for the month of May show the following information: Production Report Cutting Grinding Units in process, May 1 5,000 10,000 Started during the month 20,000 - Received from prior department 15,000 Finished and transferred 15,000 10,000 Finished and on hand 5,000 Units in process, May 31 5,000 15,000 Stage of completion 1/5 1/3 Production Costs Work in process, May 1: Costs in Cutting: $50,000 Materials $5,000 Labor A.... 6,450 Factory overhead 3,550

inventory similar to Self-Study Problem 2 Roberts Corporation uses a process cost system. The records for the month of May show the following information: Production Report Cutting Grinding Units in process, May 1 5,000 10,000 Started during the month 20,000 - Received from prior department 15,000 Finished and transferred 15,000 10,000 Finished and on hand 5,000 Units in process, May 31 5,000 15,000 Stage of completion 1/5 1/3 Production Costs Work in process, May 1: Costs in Cutting: $50,000 Materials $5,000 Labor A.... 6,450 Factory overhead 3,550

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.

Question

Required:-
Prepare a cost of production summary for each department.

Production Costs
Cost in Grinding:
Materials
5,000
Labor
5,500
.....
Factory overhead
3,500
....
Costs incurred during the month:
Materials
37,000
40,000
Labor
45,000
44,000
.REOE
Factory overhead
50,000
37,000
Total
$147,000
$185,000
Required:
Prepare a cost of production summary for each department.

inventory
similar to Self-Study Problem 2
Roberts Corporation uses a process cost system. The records for
the month of May show the following information:
Production Report
Cutting
Grinding
Units in process, May 1
5,000
10,000
Started during the month
20,000
Received from prior department
15,000
-
Finished and transferred
15,000
10,000
Finished and on hand
5,000
Units in process, May 31
5,000
15,000
Stage of completion
1/5
1/3
Production Costs
Work in process, May 1:
Costs in Cutting:
$50,000
Materials
$5,000
Labor
6,450
Factory overhead
3,550

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What are the four steps in preparing a production cost report?
Standard cost are used primarily for: Estimating future costs. To produce financial statements for external users. To judge the performance of accounting managers. To judge the performance of managers involved in the manufacturing process.
How is activity-based cost allocation useful to management for control and evaluation of the performance of a department? List three points only and briefly discuss them. Why is it necessary for the cost accountant to determine the percentage of completion in the ending work in process inventory at the end of the period? Briefly explain.
A direct material standard cost is: Group of answer choices The cost of direct materials that should be incurred to produce one unit of output or product. The amount of direct materials that should be used to produce one unit of output or product. The cost of all materials and supplies used to produce one unit of output or product. The price that should be spent to purchase each unit of direct material for production.
A report prepared periodically for each processing department and which summarizes (a) the units for which the department is accountable and the disposition of these units and (b) the production costs incurred by the department and the allocation of those costs is called a cost of production report