Question

Match each phrase that follows with the term (a–h) it describes.

a. Direct labor and factory overhead
b. Direct labor and direct materials
c. Transferred-in costs
d. Equivalent units
e. Process costing
f. Job order costing
g. First-in, first-out method
h. Cost of production report

1. A process costing method that costs each period’s equivalent units of work with that period’s costs per equivalent unit
2. Measure of the work done during a production period, expressed in terms of fully complete units of output
3. Conversion costs
4. Summary of the activity in a processing department for a specific period
5. Costing system used by a company producing computer chips
6. Prime costs
7. Costs incurred in a previous process that are carried forward as part of the product’s cost when it moves to the next department
8. Costing system used by a company producing custom window treatments

Answer 1

The question involves matching terms related to cost accounting principles with descriptions of these principles. The matches cover concepts such as FIFO method, equivalent units, conversion costs, and types of costing systems like process costing and job order costing.

Step-by-step explanation:

The student is asking to match phrases related to cost accounting concepts with their respective terms. Here are the correct matches:

First-in, first-out method (g): A process costing method that costs each period’s equivalent units of work with that period’s costs per equivalent unitEquivalent units (d): Measure of the work done during a production period, expressed in terms of fully complete units of outputConversion costs (a): Direct labor and factory overheadCost of production report (h): Summary of the activity in a processing department for a specific periodProcess costing (e): Costing system used by a company producing computer chipsPrime costs (b): Direct labor and direct materialsTransferred-in costs (c): Costs incurred in a previous process that are carried forward as part of the product’s cost when it moves to the next departmentJob order costing (f): Costing system used by a company producing custom window treatments

This exercise helps grasp the basic idea of cost origins and their relation to production, including production technologies and how they impact various cost functions.

Answer 2

1. G

2. D

3. A

4. H

5. E

6. B

7. C

8. F

Step-by-step explanation:

1. First-in, first-out method: A process costing method that costs each period’s equivalent units of work with that period’s costs per equivalent unit

2. Equivalent units: Measure of the work done during a production period, expressed in terms of fully complete units of output

3. Direct labor and factory overhead: Conversion costs

4. Cost of production report: Summary of the activity in a processing department for a specific period

5. Process costing: Costing system used by a company producing computer chips

6. Direct labor and direct materials: Prime costs

7. Transferred-in costs: Costs incurred in a previous process that are carried forward as part of the product’s cost when it moves to the next department

8. Job order costing: Costing system used by a company producing custom window treatments.