Mocha Company Manufactures a Single Product by a Continuous Process,involving

question 118

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.Work in process at the beginning of the period for Department 1 was $75,000,and work in process at the end of the period totaled $60,000.The records indicate that direct materials,direct labor,and applied factory overhead for Department 2 were $50,000,$60,000,and $70,000,respectively.In addition,work in process at the beginning of the period for Department 2 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 3 during the period is

• A) Work in Process-Department 3 585,000
• Work in Process-Department 2 585,000
• B) Work in Process-Department 3 570,000
• Work in Process-Department 2 570,000
• C) Work in Process-Department 3 555,000
• Work in Process-Department 2 555,000
• D) Work in Process-Department 3 165,000
• Work in Process-Department 2 165,000

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Definitions:

Accrued Interest

The accumulation of interest on a loan or bond since the last payment date but not yet paid out to the lender.

Gain on Sale of Investments

The profit realized from selling investments for more than the purchase price.

Investments-Evans Company Bonds

Specific long-term investments made in the bonds issued by Evans Company.

Treasury Bonds

Long-term government securities issued with a fixed interest rate and maturity of generally more than 10 years.