Question

the first step in preparing a cost of production report is

The first step in preparing a cost of production report is a. computing the equivalent units of production. O b. determining the cost per equivalent unit. c. allocating costs to units transferred out. d. determining the units to be assigned costs. AN

Answer 1

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first step in preparing a cost of production report is Option d) Determining the units to be assigned costs Units compose of opening WIP, Units transferred in and Closing WIP Hence the units to be assigned costs should be worked out first Option d) Cost of goods sold To Finished goods 360000 360000 Finished goods is charged to cost of goods sold at $6 per unit Option d) $0.15 Cost per equivalent unit in September Cost $6,000 equivalent units $6,000 1 $1.00 Conversion cost per unit in August $1.15 Difference $0.15 9 Answers Option d) Commission paid per time period is fixed cost and irrelevant cost Only other 3 factors will help mangers to control and improve the manufacturing operations 10 Option d) calculate cost per equivalent unit is only in process costing Job costing does not have any such way of calculating cost per equivalent unit 11 Option a) Work in process- Department 2 To Materials $40,000 $40,000 12 Option b) How direct labor and factory overheads enter the manufacturing process