of the following nine statements are patently false. Find the five false statements. The other statements are true. F lse statements, mark the words that make the statement false. 1. In a process costing environment involving multiple departments, raw materials are only introduced in the first department, but labor and overhead may occur in any department. 2. The primary difference between job costing and process costing is that with process costing, costs ar captured for each process or department rather than for each job. 3. A job costing environment uses a job cost sheet, but a process costing environment uses a cost allocation report. 4. Process costing would be logically suited to a manufacturer of barbed wire fencing material. 5. An item is not considered in the equivalent units calculations until it is a finished good. 6. Factory overhead is not applied in a process costing environment. 7. It would be logical to maintain a separate Work in Process ledger account for each department. 8. The balance sheet of a business that uses process costing methods would include work in process and finished goods, but not raw materials inventory. 9. Process costing can be applied on a weighted-average or FIFO basis.

of the following nine statements are patently false. Find the five false statements. The other statements are true. F lse statements, mark the words that make the statement false. 1. In a process costing environment involving multiple departments, raw materials are only introduced in the first department, but labor and overhead may occur in any department. 2. The primary difference between job costing and process costing is that with process costing, costs ar captured for each process or department rather than for each job. 3. A job costing environment uses a job cost sheet, but a process costing environment uses a cost allocation report. 4. Process costing would be logically suited to a manufacturer of barbed wire fencing material. 5. An item is not considered in the equivalent units calculations until it is a finished good. 6. Factory overhead is not applied in a process costing environment. 7. It would be logical to maintain a separate Work in Process ledger account for each department. 8. The balance sheet of a business that uses process costing methods would include work in process and finished goods, but not raw materials inventory. 9. Process costing can be applied on a weighted-average or FIFO basis.

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter4: Job-order Costing And Overhead Application

Section: Chapter Questions

Problem 1MCQ: Which of the following statements is true? a. Job-order costing is used only in manufacturing firms....

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Five of the following nine statements are patently false. Find the five false statements. The other statements are true. For the false statements, mark the words that make the statement false. T/F Comment 1. In a process costing environment involving multiple departments, raw materials are only introduced in the first department, but labor and overhead may occur in any department. 2. The primary difference between job costing and process costing is that with process costing, costs are captured for each process or department rather than for each job. 3. A job costing environment uses a job cost sheet, but a process costing environment uses a cost allocation report. 4. Process costing would be logically suited to a manufacturer of barbed wire fencing material. 5. An item is not considered in the equivalent units calculations until it is a finished good. 6. Factory overhead is not applied in a process costing environment. 7. It would…
‘Process costing is a term used in cost accounting to describe one method for collecting and assigning manufacturing costs to the units produced.’ There are some statements about the process costing: An abnormal loss occurs when the expected output exceeds actual output. The scrap value of an abnormal loss is credited to the process account. The allocated cost of an abnormal gain is credited to the process account. The inputs to a process less than the normal loss are the expected output. The normal loss in a process is allocated a cost in order to reconcile the costs of inputs and outputs. The FIFO method assumes opening WIP is the first group of units to be completed. Therefore, opening WIP is charged separately to completed production, and CPU is based on current period costs. Required: Please identify which of the above statements are false and explain the reasons.
Which one of the following is not correct about job - order costing systems and process costing systems? a. Job order costing systems and process costing systems use similar manufacturing accounts. . b. Job order costing systems normally used when there are varieties of products to produced. C. In process costing systems cost accumulation is done on a department basis. d. Job order costing systems and process costing systems have different flow of costs through manufacturing accounts. e. None of the given answers
Which of the following statements about a process costing system is incorrect? 1. In a process costing system, each processing department has a work in process account 2. In a process costing system, equivalent units are separately computed for materials and for conversion costs. 3. In a process costing system, overhead can be underallocated or overallocated just as in the job-order costing. 4. In a process costing system, material costs are traced to units of products.
Which of the following statements is true?a. Job-order costing is used only in manufacturing firms.b. Process costing is used only for services.c. Job-order costing is simpler to use than process costing because the recordkeepingrequirements are less.d. The job cost sheet is subsidiary to the work-in-process account.e. All of these
16. Which of the following statements is correct? a. A standard cost system can never be used in both the job order and process costing systems. b. Standard costing can be used in job order costing system but not in process costing system. c. Standard costing can be used in either the job order costing system or process costing system. d. A standard cost system can be used in process costing system, but not in job order costing system. 17. In a process costing system, equivalent units of production are computed to determine the number of complete units that could have been produced, given no beginning and ending work-in process inventories. If a company uses standard costing in its process costing system the equivalent units of production a. are multiplied by the standard cost per unit to compute the total standard cost of units produced. b. are never used. c. are converted to standard equivalent units and then multiplied by the actual cost per unit. d. are assumed to be zero. 18. A…
Which of the following statements is false? A. The departmental and traditional costing methods create cost distortions when there is significant costs associated with batch activities. B. The manufacturing overhead is applied to product by applying the POHR to actual cost drivers that occur during the production period C. The activity based costing system provides the most accurate product costing results D. Actual manufacturing overhead costs and the actual cost driver amounts are used to create the predetermined overhead rate (POHR)
Which of the following statements is TRUE about job - order costing system: a. Actual direct labor and Actual direct materials are used to calculate total manufacturing cost. b. Applied manufacturing overhead costs are traceable costs. Actual manufacturing overhead costs are used to calculate total manufacturing cost. d. Applied overhead for the period is not known until the end of the period. All of the given answers are false. e.
Which of the following statements is true regarding by products? a. Process costing is the only method that should result in by-products. b. Job order costing systems will never have by-products. c. Job order costing systems may have instances where by-products result from the production process. d. Process costing will never have by-products from the production process.
Which of the following statements is not always true? Question 3 options: The job - order costing system is used by manufacturing companies. All costs used in job - ordering costing are actual costs. The job - order cost sheet is subsidiary to the work - in - process account. The job - order costing system is simpler to use than process costing because the record keeping requirements are less.
2. Which of the following statements about a process costing system is incorrect? a) In a process costing system, there is a work-in-progress account for each processing department. b) In a process costing system, equivalent units are separately computed for materials and for conversion costs. c) In a process costing system, overhead can be under or overapplied, just as in job-order costing. d) In a process costing system, materials costs are traced to units of products.
2. Which of the following statements about a process costing system is incorrect? a) In a process costing system, there is a work-in-progress account for each processing department. b) In a process costing system, equivalent units are separately computed for materials and for conversion costs. c) In a process costing system, overhead can be under or overapplied, just as in job-order costing. d) In a process costing system, materials costs are traced to units of products. 3.In which production setting is operation costing most appropriate? a) Custom automobile repair shop b) Landscaping business c) Oil refinery d) Clothing manufacturer