Answer the Following Questions Using the Information Below:
Morgan Clay

question 109

Multiple Choice

Answer the following questions using the information below:
Morgan Clay Products manufactures clay molded pottery on an assembly line. Its standard costing system uses two cost categories, direct materials and conversion costs. Each product must pass through the Molding Department and the Finishing Department. Direct materials are added at the beginning of the production process. Conversion costs are allocated evenly throughout production.
$\begin{array} { l } \text {Data for the Assembly Department for August 2015 are: }\\ \text {Work in process, beginuning inventory: }&1,200 \text { units } \\\text {Direct materials ( \( 100 \% \) complete) }\\\text {Conversion costs ( \( 40 \% \) complete) }\\\\ \text {Units started during August }&675 \text { units } \\\\ \text {Work in process, ending inventory: }&450 \text { units } \\\text {Direct materials ( \( 100 \% \) complete) }\\\text {Conversion costs ( \( 60 \% \) complete) }\\\\ \text {Costs for August: } \\ \text {Standard costs for Asæmbly: } \\ \text {Direct materials }& \$ 15 \text { per unit }\\ \text { Conversion costs }&\$ 27.50 \text { per unit } \\\\ \text {Work in process, beginning inventory:} \\ \text {Direct materials }&\$11,000 \\ \text { Conversion costs}&\$8,250 \\\end{array}$

-Which of the following journal entries records the Molding Department's conversion costs for the month,assuming conversion costs are 10% higher than expected?

• A) \(\begin{array} { l }
• \text {Molding Department Conversion Cost Control } &3,341.25\\ \text {Various accounts } &3,341.25\\
• \end{array}\)
• B) \(\begin{array} { l }
• \text { Materials Inventory} &33,412.50\\ \text { Molding Department Conversion Cost Control} &33,412.50\\
• \end{array}\)
• C) \(\begin{array} { l }
• \text {Molding Department Conversion Cost Control } &36,753.75\\ \text {Various accounts } &36,753.75\\
• \end{array}\)
• D) \(\begin{array} { l }
• \text {Materials Inventory }&36,753.75 \\\text {Work in Process - Molding }&36,753.75 \\
• \end{array}\)

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