A Department Adds Materials at the Beginning of the Process

question 50

Short Answer

A department adds materials at the beginning of the process and incurs conversion costs uniformly throughout the process.For the month of July, there was no beginning work in process; 40,000 units were completed and transferred out; and there were 20,000 units in the ending work in process that were 40% complete.During July, $96,000 materials costs and $84,000 conversion costs were charged to the department. The unit production costs for materials and conversion costs for July was
Materials Conversion Costs
$\begin{array} { l c c } & \text { Materials } & \text { Conversion Costs } \\\text { a. } & \$ 1.60 & \$ 1.40 \\\text { b. } & \$ 1.60 & \$ 1.75 \\\text { c. } & \$ 2.00 & \$ 1.40 \\\text { d. } & \$ 2.40 & \$ 2.13\end{array}$

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Definitions:

Adjusted Trial Balance

A financial statement that lists all accounts and their balances after adjustments have been made.

Expense Accounts

Accounts that track the costs of operating a company including costs of goods sold, operating expenses, and non-operating expenses.

Owner's Capital

The total assets contributed by the owner of a company plus the retained earnings minus withdrawals made by the owner.

Journalize Closing Entries

The process of recording year-end closing entries in the journal to prepare the accounts for the next fiscal period.