Test Bank for Managerial Accounting 5th Edition by John Wild, Ken Shaw

Process Costing and Analysis Test Bank Answer Key True / False Questions 1. The managers of process operations focus on the series of repetitive processes, or steps, resulting in a noncustomized product or service. TRUE AACSB: Communication AICPA: BB Industry AICPA: FN Decision Making Accessibility: Keyboard Navigation Blooms: Remember Difficulty: 1 Easy Learning Objective: 03-C1 Explain process operations and the way they differ from job order operations. Topic: Process Operations 03-2 2. Manufacturers that utilize process operations produce large quantities of identical products. TRUE AACSB: Communication AICPA: BB Industry AICPA: FN Decision Making Accessibility: Keyboard Navigation Blooms: Remember Difficulty: 1 Easy Learning Objective: 03-C1 Explain process operations and the way they differ from job order operations. Topic: Process Operations 3. In a process costing system costs are measured upon completion of each job. FALSE AACSB: Communication AICPA: BB Industry AICPA: FN Measurement Accessibility: Keyboard Navigation Blooms: Remember Difficulty: 1 Easy Learning Objective: 03-A1 Compare process costing and job order costing. Topic: Comparing Process and Job Order Costing Systems 03-3 4. Equivalent units of production refer to the number of units that could have been started and completed given the costs incurred during the period. TRUE AACSB: Communication AICPA: BB Industry AICPA: FN Measurement Accessibility: Keyboard Navigation Blooms: Understand Difficulty: 2 Medium Learning Objective: 03-C2 Define and compute equivalent units and explain their use in process costing. Topic: Equivalent Units of Production 5. In a process costing system, companies typically end each period with only Finished Goods Inventory. FALSE AACSB: Communication AICPA: BB Industry AICPA: FN Measurement Accessibility: Keyboard Navigation Blooms: Remember Difficulty: 1 Easy Learning Objective: 03-C2 Define and compute equivalent units and explain their use in process costing. Topic: Equivalent Units of Production