# The completed goods and the accumulated costs are

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The completed goods and the accumulated costs are transferred acrossdepartments using a journal entry that includes a debit to the Finished GoodsInventory account and a credit to the Work in Process account for the finaldepartment in the series of processes.Equivalent units of production measure the activity of a process as the number ofunits that would be completed in a period if all effort had been applied to units thatwere started and finished. This measure of production activity is used to computethe cost per equivalent unit and to assign costs to finished goods and work inprocess inventory. To compute equivalent units, determine the number of units thatwould have been finished if all materials (or conversion) had been used to produceunits that were started and completed during the period. The costs incurred by aprocess are divided by its equivalent units to yield cost per equivalent unit.If a production department has a beginning or ending inventory of partiallyprocessed units, the cost of each unit transferred out of the department iscomputed by dividing the total cost assigned to the department bythe_______________.a)equivalent units of productionb)total number of units started and finished in the periodIf a production department has a beginning or ending inventory of partiallyprocessed units, the cost of each unit transferred out of the department iscomputed by dividing the total cost assigned to the department by the equivalentunits of production.
Assume that your professor, who always drinks water during class, walked into classtoday with six bottles of water. Each bottle of water was one-half full. You wonderwhy she chose to juggle so many water bottles along with her textbook and notes.You realize that she could have simply carried:
If your instructor had poured three of the half-full bottles of water into the otherthree half-full bottles of water, she could have walked into class with three fullbottles of water. Or, in other words, six bottles of water that are 50% (or one-halffull) are equivalent to three bottles of water that are (100%) full.The _____ method computes equivalent units based only on production activity inthe current period.
A process cost summary reports on the activities of a production process ordepartment for a period. It describes the costs charged to the department, theequivalent units of production for the department, and the costs assigned to theoutput. The report aims to (1) help managers control their departments, (2) helpfactory managers evaluate department managers’ performance, and (3) providecost information for financial statements. A process cost summary includes the

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