Question 5 : The motor cars company manufactures a product that is processed in two departments: Department A and Department B. In Department A, materials are added at the beginning of the process, In Department B, materials are added at the ending of the process. In both A and B conversion costs are incurred unifomly throughout the process. As work is completed, it is transferred out. The following table summarizes the production activity and costs for November: Item Units Conversion Transferre Direct d- In costs Materials Costs Work in process, beginning inventory(July. 1) Degree of completion, beginning work in process Started during July Completed and transferred out during July Work in process, ending inventory(July. 30) Degree of completion, ending work in process Cost Data : Cost of Work in process, beginning inventory Costs added during July Required : 1. Calculate the Department's B equivalent units of production for materials and conversion in July using weighted average method. 2. Summarize total costs to account for and assign total costs to units completed and transferred out, and to units in ending work in process. 8,000 100% 50% 28,000 33,000 3,000 100% 50% $45,320 $159,880 | $37,950 $ 16,800 $128,100
Question 5 : The motor cars company manufactures a product that is processed in two departments: Department A and Department B. In Department A, materials are added at the beginning of the process, In Department B, materials are added at the ending of the process. In both A and B conversion costs are incurred unifomly throughout the process. As work is completed, it is transferred out. The following table summarizes the production activity and costs for November: Item Units Conversion Transferre Direct d- In costs Materials Costs Work in process, beginning inventory(July. 1) Degree of completion, beginning work in process Started during July Completed and transferred out during July Work in process, ending inventory(July. 30) Degree of completion, ending work in process Cost Data : Cost of Work in process, beginning inventory Costs added during July Required : 1. Calculate the Department's B equivalent units of production for materials and conversion in July using weighted average method. 2. Summarize total costs to account for and assign total costs to units completed and transferred out, and to units in ending work in process. 8,000 100% 50% 28,000 33,000 3,000 100% 50% $45,320 $159,880 | $37,950 $ 16,800 $128,100
Chapter5: Process Costing
Section: Chapter Questions
Problem 1PB: The following product costs are available for Stellis Company on the production of erasers: direct...
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Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
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Question 5 :
The motor cars company manufactures a product that is processed in two
departments: Department A and Department B. In Department A, materials are added at the
beginning of the process, In Department B, materials are added at the ending of the process. In
both A and B conversion costs are incurred uniformly throughout the process. As work is
completed, it is transferred out. The following table summarizes the production activity and costs
for November:
Item
Units
Transferre
Direct
Conversion
d- In costs
Materials
Costs
Work in process, beginning inventory(July. 1)
Degree of completion, beginning work in process
Started during July
Completed and transferred out during July
Work in process, ending inventory(July. 30)
Degree of completion, ending work in process
Cost Data :
Cost of Work in process, beginning inventory
Costs added during July
Required :
1. Calculate the Department's B equivalent units of production for materials and conversion
in July using weighted average method.
2. Summarize total costs to account for and assign total costs to units completed and
transferred out, and to units in ending work in process.
8,000
100%
50%
28.000
33,000
3.000
100%
50%
$45,320
$159,880
$16,800
$128,100
$37,950
Question 4: The motor cars company manufactures a product that is processed in two departments
Department A and Department B. In Department A, materials are added at the beginning of the process
conversion costs are incurred uniformly throughout the process. As work is completed, it is transferred
out. The following table summarizes the production activity and costs for November:
Department A
Beginning inventories:
Physical units
Costs:
Transferred in
Direct materials
5,000
$ 10,000
$ 6,900
Conversion costs
Current production:
Units started
25,000
28,000
Units transferred out
Costs:
Transferred in
Direct materials
$57,800
Conversion costs
$95,220
Percentage completion:
Beginning inventory
Ending inventory
40%
80%
Required :
1. Calculate the Department's A equivalent units of production for materials and conversion
in July using FIFO method.
2. Summarize total costs to account for and assign total costs to units completed and
transferred out, and to units in ending work in process.
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