Up-to-date information about production order status is required to do which of the following tasks?

Up-to-date information about production order status is required to do which of the following tasks?
A . Calculate current take time.
B . Determine planned orders.
C . Replenish kanban quantities.
D . Calculate the cost of work in process (WIP).

View Answer

Answer: D

Explanation:

Up-to-date information about production order status is required to calculate the cost of work in process (WIP). WIP is the inventory of unfinished goods or partially completed products that are still in the production process1. The cost of WIP is the sum of the costs of the materials, labor, and overhead that have been incurred in the production process but have not yet been transferred to the finished goods inventory2. To calculate the cost of WIP, we need to know how much of each production order has been completed and how much remains to be done. This information can be obtained from the production order status, which is a report that shows the current status of each production order in terms of its quantity, start date, end date, completion percentage, and variance3. By using the production order status, we can determine the amount of WIP for each production order and for the entire production process. This can help us monitor and control the production efficiency, profitability, and quality4.

Reference: 1: Work In Progress (WIP) Definition 2 2: Work-in-Process (WIP) Accounting 3 3: Production Order Status Report 5 4: How to Calculate Work in Process Inventory 6