ABC Produces Ping-Pong Balls Using a Three-Step Process That Includes

question 201

Multiple Choice

ABC produces ping-pong balls using a three-step process that includes molding, colouring and finishing. Which of the following accounts is credited for direct labour used during the molding process?

• A) WIP inventory-molding
• B) Manufacturing overhead
• C) Raw materials inventory
• D) Wages payable

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Definitions:

Cost of Production

The total expense incurred in manufacturing a product or providing a service, including raw materials, labor, and overheads.

Transferred-in Costs

Costs accumulated from previous departments or processes that are carried forward into the cost of new products or stages of production.

Weighted Average Method

An inventory costing method calculating the cost of goods sold and ending inventory based on the weighted average cost of all items available for sale.

Packaging Department

A division within a manufacturing company responsible for designing, producing, and managing the packaging of products.