Indicate Whether Each of the Following Statements About Process Costing

question 88

Short Answer

Indicate whether each of the following statements about process costing systems is true or false.
The number of equivalent units can be calculated by the FIFO method or by the weighted average method.______
For Company X,the cost in beginning work in process was $18,000; costs incurred during the month were $52,100; the number of equivalent units for the month was 8,400.Company X calculates equivalent units by the weighted average method.The cost per equivalent unit was $6.20.______
The allocation of costs between products transferred out and those still in process at the end of the period is shown on a cost of production report.______
The weighted average method of calculating equivalent units takes into account the stage of completion of beginning work in process but not ending work in process.______
Many companies use the weighted average method to calculate equivalent units because the method is relatively easy to use.______

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Definitions:

Carrying Value

The book value of assets and liabilities reported on the balance sheet, calculated as original cost less any depreciation, amortization, or impairment costs.

GAAP

Generally Accepted Accounting Principles; the standard framework of guidelines for financial accounting used in any given jurisdiction.

Market Value

The current price at which an asset or service can be bought or sold in a fair and open market.

Bond Interest Expense

The cost incurred by an entity for the interest due on its issued bonds over a specific period.