Weighted Average MethodHOFFMAN COMPANYProduction Cost ReportMonth Ended October 31, 2022Equivalent UnitsPhysicalUnitsDirect ConversionMaterials CostsUNITSUnits to account for:Beginning WIPStarted in productionTotal units to account forUnits accounted for:Beginning WIPStarted and completedEnding work-in-processTotal units accounted for40002250024500COSTSCosts to account for:Beginning WIPCurrent period costsTotal costs to account forDivided by: Total EUPCost per equivalent unitCosts accounted for:Transferred outEnding WIP inventoryDirect MaterialConversionTotal costs accounted forDirectMaterialsConversionTotalCostsCosts1489,6501,248,000 241,6504635,000 2,575,1257210,1258,699,775 Weighted-average method. Hoffman Company manufactures car seats in its Boise plant. Each car seatpasses through the assembly department and the testing department. This problem focuses on the assemblydepartment. The process-costing system at Hoffman Company has a single direct-cost category (directmaterials) and a single indirect-cost category (conversion materials are added at the costs). Directbeginning of the process. Conversion costs are added evenly during the process. When the assemblydepartment finishes work on each car seat, it is immediately transferred to testing.Hoffman Company uses the weighted-average method of process costing. Data for the assemblydepartment for October 2019 are as follows:Physical Units(Car Seats)DirectMaterialsConversionCostsWork in process, October 1ª4,000$1,248,000$ 241,650Started during October 201922,500Completed during October 201926,000Work in process, October 31b500Total costs added during October$4,635,000$2,575,1252019* Degree of completion: direct materials,?%; conversion costs, 45%.bDegree of completion: direct materials,?%; conversion costs, 65%.

Name: Weighted Average MethodHOFFMAN COMPANYProduction Cost ReportMonth End
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Description: Weighted Average MethodHOFFMAN COMPANYProduction Cost ReportMonth Ended October 31, 2022Equivalent UnitsPhysicalUnitsDirect ConversionMaterials CostsUNITSUnits to account for:Beginning WIPStarted in productionTotal units to account forUnits accounte

Weighted average method is one of the inventory valuation methods. Beginning work in process account…

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Weighted-average method. Hoffman Company manufactures car seats in its Boise plant. Each car se passes through the assembly department and the testing department. This problem focuses on the assembl department. The process-costing system at Hoffman Company has a single direct-cost category (dire materials) and a single indirect-cost category (conversion materials are added at the costs). Direc beginning of the process. Conversion costs are added evenly during the process. When the assembl department finishes work on each car seat, it is immediately transferred to testing. Hoffman Company uses the weighted-average method of process costing. Data for the assembl department for October 2019 are as follows: Physical Units Direct Conversion (Car Seats) Materials Costs Work in process, October 1ª 4,000 $1,248,000 $ 241,650 Started during October 2019 22,500 Completed during October 2019 26,000 Work in process, October 31b 500 Total costs added during October $4,635,000 $2,575,125 2019 *Degree of completion: direct materials,?%; conversion costs, 45%. b Degree of completion: direct materials.?%: conversion costs. 65%.

Weighted-average method. Hoffman Company manufactures car seats in its Boise plant. Each car se passes through the assembly department and the testing department. This problem focuses on the assembl department. The process-costing system at Hoffman Company has a single direct-cost category (dire materials) and a single indirect-cost category (conversion materials are added at the costs). Direc beginning of the process. Conversion costs are added evenly during the process. When the assembl department finishes work on each car seat, it is immediately transferred to testing. Hoffman Company uses the weighted-average method of process costing. Data for the assembl department for October 2019 are as follows: Physical Units Direct Conversion (Car Seats) Materials Costs Work in process, October 1ª 4,000 $1,248,000 $ 241,650 Started during October 2019 22,500 Completed during October 2019 26,000 Work in process, October 31b 500 Total costs added during October $4,635,000 $2,575,125 2019 *Degree of completion: direct materials,?%; conversion costs, 45%. b Degree of completion: direct materials.?%: conversion costs. 65%.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter4: Activity-based Costing

Section: Chapter Questions

Problem 36P: Reducir, Inc., produces two different types of hydraulic cylinders. Reducir produces a major...

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Reducir, Inc., produces two different types of hydraulic cylinders. Reducir produces a major subassembly for the cylinders in the Cutting and Welding Department. Other parts and the subassembly are then assembled in the Assembly Department. The activities, expected costs, and drivers associated with these two manufacturing processes are given below. Note: In the assembly process, the materials-handling activity is a function of product characteristics rather than batch activity. Other overhead activities, their costs, and drivers are listed below. Other production information concerning the two hydraulic cylinders is also provided: Required: 1. Using a plantwide rate based on machine hours, calculate the total overhead cost assigned to each product and the unit overhead cost. 2. Using activity rates, calculate the total overhead cost assigned to each product and the unit overhead cost. Comment on the accuracy of the plantwide rate. 3. Calculate the global consumption ratios. 4. Calculate the consumption ratios for welding and materials handling (Assembly) and show that two drivers, welding hours and number of parts, can be used to achieve the same ABC product costs calculated in Requirement 2. Explain the value of this simplification. 5. Calculate the consumption ratios for inspection and engineering, and show that the drivers for these two activities also duplicate the ABC product costs calculated in Requirement 2.
Lacy, Inc., produces a subassembly used in the production of hydraulic cylinders. The subassemblies are produced in three departments: Plate Cutting, Rod Cutting, and Welding. Materials are added at the beginning of the process. Overhead is applied using the following drivers and activity rates: Other data for the Plate Cutting Department are as follows: Required: 1. Prepare a physical flow schedule. 2. Calculate equivalent units of production for: a. Direct materials b. Conversion costs 3. Calculate unit costs for: a. Direct materials b. Conversion costs c. Total manufacturing 4. Provide the following information: a. The total cost of units transferred out b. The journal entry for transferring costs from Plate Cutting to Welding c. The cost assigned to units in ending inventory
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Central Perk, LLC, a manufacturer of coffee beans, is considering switching its operations to an Activity Based Costing system. The following manufacturing overhead activities and cost drivers have been identified: Activity. Machine setup Machine assembly Product inspection Product movement General factory Cost Driver Number of machine setups Machine hours logged Inspection hours logged Number of moves Machine hours logged Based on the above descriptions, which of the following correctly pairs the activity with its appropriate cost level? O A. Product Inspection... batch level cost OB. Product Movement... facility level cost O C. Machine Assembly... unit level cost O D. General Factory... batch level cost O E. Machine Setup... unit level cost
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Makani Handcraft is a manufacturer of picture frames for large retailers. Every picture frame passes through two departments: the assembly department and the finishing department. This problem focuses on the assembly department. The process-costing system at Makani has a single direct-cost category (direct materials) and a single indirect-cost category (conversion costs). Direct materials are added at the beginning of the process. Conversion costs are added evenly during the assembly department's process. Consider the following data for the assembly department in June 2020: Physical units (Frames) Direct materials Direct labour Work in progress (June 1) 80 $1,500 $150 Completed during June 500 Work in progress June 30 200 Total costs added during June $17,800 $11,500 Degree of completion is as follows: Work in progress (June 1): 100% 60% Work in progress June 30 100% 25% Required: Compute the costs assigned to products using two methods: 1. Weighted average method (WAM); | 2. First in…
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