Financial & Managerial Accounting: Information for Decisions w Access Card, 5th edition, ACC 211 & 212, Northern Virginia Community College
Financial & Managerial Accounting: Information for Decisions w Access Card, 5th edition, ACC 211 & 212, Northern Virginia Community College
5th Edition
ISBN: 9781259347641
Author: Ken W. Shaw, Barbara Chiappetta John J. Wild
Publisher: McGraw Hill Education
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Chapter 16, Problem 6E

1.

To determine

To compute: Equivalent unit of production according to weighted average method.

1.

Expert Solution
Check Mark

Explanation of Solution

For direct material:

Given,
Completed goods are 295,000 units.
Work in progress is 24,000 units.

Formula for calculating equivalent unit of production (direct material),

    EquivalentUnitofProduction(DirectMaterial)=( CompletedGoods +WorkinProgress )

Substitute 295,000 units for completed goods and 24,000 units for work in progress.

    EquivalentUnitofProduction=295,000+24,000 =319,000

Hence, equivalent unit of production (direct material) is 319,000 units.

Working note:

Calculation for work in progress,

    Workinprogress=Unfinsihedgoods×Finishedpercentage =30,000× 80 100 =24,000

For conversion:

Given,
Completed goods are 295,000 units.
Work in progress is 9,000 units.

Formula for calculating equivalent unit of production (conversion),

    EquivalentUnitofProduction(Conversion)=( CompletedGoods +Workinprogress )

Substitute, 295,000 units for completed goods and 9,000 units for work in progress in the above equation,

    EquivalentUnitofProduction=295,000+9,000 =304,000

Hence, equivalent unit of production (conversion) is 304,000 units.

Working note:

Calculation for work in progress,

    Workinprogress=Unfinsihedgoods×Finishedpercentage =30,000× 30 100 =9,000

2.

To determine

To compute: Cost per equivalent unit of production.

2.

Expert Solution
Check Mark

Explanation of Solution

For direct material:

Given,
Total direct material cost is $1,276,000.
Total EUP (Direct Material) is 319,000 units.

Formula for calculating cost per equivalent unit of production,

    CostperEUP(DirectMaterial)= TotalDirectMaterialCost TotalEUP(DirectMaterial)

Substitute, $1,276,000 for total direct material cost and 319,000 units for total EUP (direct material).

    CostperEUP(DirectMaterial)= $1,276,000 319,000 =$4

Hence, cost per EUP (Direct Material) is $4.

Working note:

Calculation for total direct material cost,

    TotalDirectMaterialCost=( DirectMaterialIntheopeninginventory +Directmatrialusedduringthemonth ) =$44,800+$1,231,200 =$1,276,000

For conversion:

Given,
Total conversion cost is $912,000.
Total EUP (Conversion) is 304,000 units.

Formula for calculating cost per equivalent unit of production,

    CostperEUP(Conversion)= TotalDirectMaterialCost TotalEUP(Conversion)

Substitute $912,000 for total conversion cost and 304,000 units for total EUP (conversion).

    CostperEUP(DirectMaterial)= $912,000 304,000 =$3

Hence, cost per EUP (conversion) is $3.

Working note:

Calculation for total direct material cost,

    Totalconversioncost=( Conversioncostintheopeninginventory +Conversioncostusedduringthemonth ) =$15,300+$896,700 =$912,000

3.

To determine

To compute: Assign cost to forming department.

3.

Expert Solution
Check Mark

Explanation of Solution

Given,
Direct material cost for completed goods is $1,280,000.
Conversion cost for completed goods is $885,000.

For completed goods:

Formula for calculating the cost of unit completed,

    CostofUnitsCompleted=( DirectMaterialCostforCompletedGoods +ConversionCostforCompletedGoods )

Substitute, $1,280,000 for direct material cost for completed goods and $885,000 for conversion cost for completed goods.

    CostofUnitsCompleted=$1,280,000+$885,000 =$2,165,000

Hence, cost of unit completed is $2,165,000.

Working notes:

Calculation for direct material cost for completed goods,

    DirectMaterialCostforCompletedGoods=( CompletedGoods ×CostperEUP(DirectMaterial) ) =295,000×$4 =$1,280,000

Calculation for conversion cost for completed goods,

    ConversionCostforCompletedGoods=( CompletedGoods ×CostperEUP(Conversion) ) =295,000×$3 =$885,000

For work in process (end):

Given,
Direct material cost for work in process (end) is $96,000.
Conversion cost for work in process (end) is $27,000.

Formula for calculating the cost of work in process (end),

    Costofwork in process( end )=( DirectMaterialCostforCompletedGoods +ConversionCostforCompletedGoods )

Substitute, $96,000 for direct material cost for work in process (end) and $27,000 for conversion cost for work in process (end).

    Costofwork in process ( end )=$96,000+$27,000 =$123,000

Hence, cost of work in process (end) is $123,000.

Working notes:

Calculation for direct material cost for work in process (end),

    [ DirectMaterialCostfor work in process ( end ) ]=[ EUP(DirectMaterial)forwork in process ( end ) ×CostperEUP(DirectMaterial) ] =24,000×$4 =$96,000

Calculation for conversion cost for work in process (end),

    [ ConversionCostfor CompletedGoods ]=[ EUP(Conversion)forwork in process ( end ) ×CostperEUP(Conversion) ] =9,000×$3 =$27,000

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Chapter 16 Solutions

Financial & Managerial Accounting: Information for Decisions w Access Card, 5th edition, ACC 211 & 212, Northern Virginia Community College

Ch. 16 - Prob. 6DQCh. 16 - Prob. 7DQCh. 16 - Prob. 8DQCh. 16 - Prob. 9DQCh. 16 - Prob. 10DQCh. 16 - Prob. 11DQCh. 16 - Prob. 12DQCh. 16 - 13. List the four steps in accounting for...Ch. 16 - 14. APPLE Companies such as Apple commonly...Ch. 16 - 15. GOOGLE Are there situations where Google can...Ch. 16 - Prob. 16DQCh. 16 - Prob. 17DQCh. 16 - Process vs. job order operations C1 For each of...Ch. 16 - Prob. 2QSCh. 16 - Prob. 3QSCh. 16 - Physical flow reconciliation C2 The following...Ch. 16 - Prob. 5QSCh. 16 - Prob. 6QSCh. 16 - Prob. 7QSCh. 16 - Prob. 8QSCh. 16 - Prob. 9QSCh. 16 - Prob. 10QSCh. 16 - Prob. 11QSCh. 16 - Prob. 12QSCh. 16 - Prob. 13QSCh. 16 - Prob. 14QSCh. 16 - Prob. 15QSCh. 16 - Prob. 16QSCh. 16 - Prob. 17QSCh. 16 - Prob. 18QSCh. 16 - Prob. 19QSCh. 16 - Prob. 20QSCh. 16 - Prob. 21QSCh. 16 - Prob. 22QSCh. 16 - Prob. 23QSCh. 16 - Prob. 24QSCh. 16 - Prob. 25QSCh. 16 - Prob. 26QSCh. 16 - Process Cost Summary C3 Anheuser-Busch In Bev is...Ch. 16 - Prob. 1ECh. 16 - Prob. 2ECh. 16 - Prob. 3ECh. 16 - Prob. 4ECh. 16 - Prob. 5ECh. 16 - Prob. 6ECh. 16 - Prob. 7ECh. 16 - Prob. 8ECh. 16 - Prob. 9ECh. 16 - Prob. 10ECh. 16 - Prob. 11ECh. 16 - Prob. 12ECh. 16 - Exercise 16-13AFIFO: Completing a process cost...Ch. 16 - Prob. 14ECh. 16 - Prob. 15ECh. 16 - Exercise 16-16 Weighted average: Process cost...Ch. 16 - Prob. 17ECh. 16 - Prob. 18ECh. 16 - Prob. 19ECh. 16 - Prob. 20ECh. 16 - Prob. 21ECh. 16 - Prob. 22ECh. 16 - Prob. 23ECh. 16 - Prob. 24ECh. 16 - Prob. 25ECh. 16 - Prob. 26ECh. 16 - Exercise 16-27 Hybrid Costing System A2 Explain a...Ch. 16 - Prob. 1PSACh. 16 - Prob. 2PSACh. 16 - Prob. 3PSACh. 16 - Prob. 4PSACh. 16 - Problem 16-5AA FIFO: Process cost summary;...Ch. 16 - Prob. 6PSACh. 16 - Prob. 7PSACh. 16 - Prob. 1PSBCh. 16 - Prob. 2PSBCh. 16 - Prob. 3PSBCh. 16 - Problem 16-4B Weighted average: Process cost...Ch. 16 - Problem 16-5BA FIFO: Process cost summary;...Ch. 16 - Prob. 6PSBCh. 16 - Prob. 7PSBCh. 16 - Prob. 16SPCh. 16 - Prob. 16CPCh. 16 - Prob. 1GLPCh. 16 - Prob. 1BTNCh. 16 - Prob. 2BTNCh. 16 - Prob. 3BTNCh. 16 - Prob. 4BTNCh. 16 - Prob. 5BTNCh. 16 - Prob. 6BTNCh. 16 - Prob. 7BTNCh. 16 - Prob. 8BTNCh. 16 - Prob. 9BTN
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