In July, One of the Processing Departments at Keen Corporation

question 63

Multiple Choice

In July, one of the processing departments at Keen Corporation had beginning work in process inventory of $19,000 and ending work in process inventory of $18,000. During the month, the cost of units transferred out from the department was $216,000. The company uses the FIFO method in its process costing system.
-In the department's cost reconciliation report for July, the costs added to production in the department would be:

• A) $217,000
• B) $198,000
• C) $197,000
• D) $215,000

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Definitions:

Adjusting Entries

Entries made in accounting records at the end of an accounting period to allocate income and expenditures to the period in which they actually occurred.

Cost of Goods Sold

Expenses directly connected with making the products a company offers for sale.

FOB Destination

A shipping term indicating that the seller is responsible for the cost and risk of transport until the goods reach the buyer's location.

Buyer's Place

The agreed location where the buyer takes ownership of goods purchased, significant in determining shipping costs and liability.