2-09 cpa exam questions (solutions)-1.pdf

2-09 cpa exam questions (solutions)-1.pdf - QUESTIONS FROM...

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Unformatted text preview: QUESTIONS FROM RECENT CPA EXAMS Chapters 2,4,5,6 Job-Order Costing, Overhead and Cost Flows 1—(2009 CPA Exam} Selected information concerning the operations of a company for the year ended December 31 is as follows: Units produced 20,000 Units sold 18,000 Direct materials used $80,000 Direct labor incurred $40,000 > I 4 ‘1: 00° Factory overhead $74,000 Work in process inventories at the beginning and end of the year were zero. Beginning inventory of finished goods was $9,650 (for 1,000 units). Cost of goods sold was $174,600. What was the company’s finished goods inventory cost at December 31? w l .0 F o- b. $29,100 0 @szspso lfiflooo I flood —— [9,5900 d. $40,600 0 2-12010 CPA Exam Lorrimer Company has a job—order cost system. The following debits (credits) appeared in the Work—in—Process account for the month of June. June 1, balance $12,000 June 30, direct materials 50,000 During the month of June, direct labor totaled $30,000 and $24,000 of overhead was applied to production. Finished Goods was debited $100,000 during June. Lorrimer Company applies overhead at a predetermined rate of 80% of direct labor cost. Job number 83, the only job still in process at the end of June, has been charged with manufacturing overhead of $3,400. What was the amount of direct materials charged to Job nur'rper 83? w: I” __ J03 J 3 a. $3,400 ’ 0 a) a M 2 M 13. $4,250 M JO. 0? 100,00 m5)“ _—; l... t/ xro $8,350 ’- 3"! ”0° 7' 5“9‘70 " 9Y0? $7,580 0 2.1, 00° 3-(2009 CPA Exam) 1; It 000 z? vaT B? JUL ‘3’ 2 --——" / / Merry Co. has two major categories of factory overhead: materials handling and quality control. The costs expected for these categories for the coming year are as follows: I Material handling $120,000 > 9&0; m Quality inspection 200,000 The plant currently applies overhead based on direct labor hours. The estimated direct labor hours are 80,000 per year. The plant manager is asked to submit a bid and assembles the following data on a proposed job. '9 9 H11. :- 5M :3 Y/JM Direct materials $ 4,000 fa on J Direct labor (2,000 hours) 6,000 TI" 15 ’ (9 ': 3’ / What amount is the estimated product cost on the proposed job? m. ‘5 a. $8,000 b. $10,000 0 0 .) c. $14,000 I if“ @$18,000 PROCESS COSTING 1- (CPA 2009 Exam, adapted) Weighted average and first—in, first—out (FIFO) equivalent units would be the same in a period . en which of the following occurs? / C?“ beginning inventory exists. 7—”.— %f (f I? 0"“ M f of 60/4 WW . No ending inventory exists. c. Beginning inventory equivalent units exceed 50% complete. (1. Beginning inventory equivalent units are less than 50% complete. 2-During the month of June, the mixing department produced and transferred out 3,500 units. Ending work in process had 1,000 units, 40 percent complete with respect to conversion costs. There was no he innin work in recess. The e uivalent units of output for conversion costs for the month of June are: a.3,500 \) U56 w/4— gr‘fp 4.. QM I.‘(/ b. 4,500 3,900 . 1,000 3— As goods are transferred from a prior process to a subsequent process, the following entry to record the cost of abnormal spoilage would be made: a. debit Work in Process (subsequent department) and credit Work in Process (prior epartment) ebit Abnormal Spoilage Loss and credit Work in Process (prior department) 0. debit Finished Goods and credit Work in Process (prior department) d. debit Finished Goods and credit Abnormal Loss 4—During March, Hanks Manufacturing started and completed 30,000 units. In beginning work in process, there were 5,000 units 60. ercent complete with respect to conversion costs. Materials are added at the beginning of the proce . EWTP there were 10,000 units 40 percent complete for conversion costs. Using FIFO, the e uiv t units of materials and conversion costs are, -__-——‘ respectively: VA 2:. § 45,000, 36,000 V-B‘J’ 40,000, 36,000 ?o N o o 0 6 or» c. 45,000, 34,000 3/ c 3 I a . ’ 3 ’0 1’ coo d. 40,000, 34,000 FM 3w? 5' 0 ‘9“ (”WV ’ ,3 o a D l t '9 0" 9 ‘1’ '9 0 gm; (9 [0 C ‘0 fl! (1.“ -—J--—- S—(CPAZOllExam) {40,0 03 1 5, 0"“ A company uses process costing to assign product costs. Available inventory information for a period is as follows: {xi/ma, .l W inventory Material Conversion l A (in units) Cost Cost W é Beginning 0 Started during period 15,000 75,000 55,500 Transferred out 1 3,500 End of period 1,500 The ending inventory was 25% complete as to the conversion cost. 100% of direct material was added at the beginning of the process. What was the total cost transferred out? a. $130,500 b. $126,973 @3121500 M if ,~ d.$ll7,450 M #74” gyr C _._—7=——— [flow #fiiafm’v -;/ yflfm) burp / 6’9 (.0?! f,— ...
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