Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

3. Accrual Accounting Concepts

Introduction to Adjusting Journal Entries and Prepaid Expenses

Financial Accounting

3. Accrual Accounting Concepts

Introduction to Adjusting Journal Entries and Prepaid Expenses

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Multiple Choice

In step 4 of the process, the equivalent units of production (EUP) from step 2 and the cost per EUP from step 3 are used to assign costs to the:

Units completed and ending work in process inventory

Units started but not yet completed

Direct labor incurred during the period

Raw materials purchased during the period

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Verified step by step guidance

Step 1: Understand the concept of Equivalent Units of Production (EUP). EUP is a measure used in process costing to express partially completed units in terms of fully completed units. It helps allocate costs accurately between completed units and units still in process.

Step 2: Review the calculation of EUP from step 2. This involves determining the number of units completed and transferred out, as well as the equivalent units for ending work in process inventory based on their percentage of completion.

Step 3: Examine the cost per EUP from step 3. This is calculated by dividing the total costs (including direct materials, direct labor, and overhead) by the equivalent units of production for each cost component.

Step 4: Use the EUP and cost per EUP to assign costs. Multiply the cost per EUP by the number of equivalent units for completed units and ending work in process inventory. This ensures costs are distributed proportionally based on production activity.

Step 5: Allocate the costs to the appropriate categories. The costs are assigned to 'Units completed and ending work in process inventory,' as these are the relevant categories for process costing. Other options like 'Units started but not yet completed,' 'Direct labor incurred during the period,' and 'Raw materials purchased during the period' are not directly related to this step.