For a Firm, Which Produces Its Product Through Two Processes

question 3

Multiple Choice

For a firm, which produces its product through two processes, the costs in opening work in process for Process 2 are best described as

• A) prior process costs.
• B) transferred in costs.
• C) prior period costs.
• D) conversion costs.

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Definitions:

Credits

Accounting entries that represent an increase in liabilities or revenues, or a decrease in assets or expenses.

Adjusting Entries

Adjusting entries are journal entries made in an accounting period's end to allocate income and expenditures to the period in which they actually occurred.

Chart of Accounts

A structured list detailing a company's financial accounts, categorized to facilitate the organization and reporting of financial transactions.

Accounting Period

A specific time frame in which financial activities are recorded and reported, commonly a year or a quarter.