Mocha Company Manufactures a Single Product by a Continuous Process

question 161

Multiple Choice

Mocha Company manufactures a single product by a continuous process, involving three production departments. The records indicate that direct materials, direct labor, and applied factory overhead for Department 1 were $100,000, $125,000, and $150,000, respectively. The records further indicate that direct materials, direct labor, and applied factory overhead for Department 2 were $55,000, $65,000, and $80,000, respectively. In addition, work in process at the beginning of the period for Department 1 totaled $75,000, and work in process at the end of the period totaled $60,000.
The journal entry to record the flow of costs into Department 2 for applied overhead is

• A) Factory Overhead-Department 2                 80,000     Work in Process-Department 2                                          80,000
• B) Work in Process-Department 2                  230,000     Factory Overhead-Department 2                                      230,000
• C) Work in Process-Department 2                    80,000     Factory Overhead-Department 2                                        80,000
• D) Work in Process-Department 2                  150,000     Factory Overhead-Department 2                                      150,000

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Definitions:

Standard Error

The standard deviation of the sampling distribution of a statistic, often used to estimate the accuracy of sample mean as an approximation of the population mean.

Means

The arithmetic averages of a set of numbers or data points.

N = 11

A statement indicating a sample size, or total number of observations, equals to eleven.

Critical Value

A threshold in statistics above or below which a statistical result is considered significant.