Answer the following statements true (T) or false (F)
1. The production cost report for Department 2 shows that $452,000 was assigned to the 59,000 units transferred to Finished Goods Inventory. This cost assigned to Finished Goods Inventory is recorded with a debit to Work-in-Process—Department 2. Process costing is used.
2. The production cost report for Department 2 shows that $454,000 was assigned to the 50,000 units transferred to Finished Goods Inventory. Cost of goods manufactured equals $454,000. Process costing is used.
3. The production cost report for Department 2 shows that $457,000 was assigned to the 51,000 units transferred to Finished Goods Inventory. Cost of goods sold equals $457,000. Process costing is used.
Explanation: Cost of goods manufactured equals $457,000.
4. A company uses process costing and a perpetual inventory system. When finished products are sold, Cost of Goods Sold is debited and Finished Goods Inventory is credited.
5. In a process costing system, costs can be controlled with the aid of a production cost report.
1 FALSE
Explanation:
Finished Goods Inventory 452,000
Work-in-Process—Department 2 452,000
2. TRUE
3. FALSE
4. TRUE
5. TRUE
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