Horngren's Financial & Managerial Accounting, The Managerial Chapters (6th Edition)
6th Edition
ISBN: 9780134486857
Author: Tracie L. Miller-Nobles, Brenda L. Mattison, Ella Mae Matsumura
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 18, Problem 36AP
1.
To determine
Prepare production cost report for testing department using weighted average method.
2.
To determine
Calculate the cost per unit for lifts completed and transferred to finished goods inventory, and for what reason management would be interested in this cost.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
how can i resolve this problem?
Arona Corporation manufactures canoes in two departments, Fabrication and Waterproofing. In the Fabrication Department, fiberglass panels are attached to a canoe- shaped aluminum frame. The canoes are then transferred to the Waterproofing department to be coated with sealant. Arona uses a weighted-average process cost system to collect costs in both departments.
All materials in the Fabrication Department are added at the beginning of the production process. On July 1, the Fabrication Department had 30 canoes in process that were 20% complete with respect to conversion cost. On July 31, Fabrication had 20 canoes in process that were 40% complete with respect to conversion cost. During July, the Fabrication Department completed 90 canoes and transferred them to the Waterproofing Department.
What are the Fabrication Department's equivalent units of production related to conversion costs for July?
Preparing production cost report, second department with beginning WIP; decision making
Ocean Worthy uses three processes to manufacture lifts for personal watercraft: forming a lift’s parts from galvanized steel, assembling the lift, and testing the completed lift. The lifts are transferred to Finished Goods Inventory before shipment to marinas across the country.
Ocean Worthy’s Testing Department requires no direct materials. Conversion costs are incurred evenly throughout the testing process. Other information follows for the month of August:
The cost transferred into Finished Goods Inventory is the cost of the lifts transferred out of the Testing Department. Ocean Worthy uses Weighted-average process costing.
Requirements
Prepare a production cost report for the Testing Department.
What is the cost per unit for lifts completed and transferred out to Finished Goods Inventory? Why would management be interested in this cost?
Arona Corporation manufactures canoes in two departments, Fabrication and Waterproofing. In the Fabrication Department, fiberglass panels are
attached to a canoe- shaped aluminum frame. The canoes are then transferred to the Waterproofing department to be coated with sealant. Arona uses a
weighted-average process cost system to collect costs in both departments.
All materials in the Fabrication Department are added at the beginning of the production process. On July 1, the Fabrication Department had 30 canoes
in process that were 20% complete with respect to conversion cost. On July 31, Fabrication had 20 canoes in process that were 40% complete with
respect to conversion cost. During July, the Fabrication Department completed 87 canoes and transferred them to the Waterproofing Department.
What are the Fabrication Department's equivalent units of production related to conversion costs for July?
Multiple Choice
95
117
79
107
Chapter 18 Solutions
Horngren's Financial & Managerial Accounting, The Managerial Chapters (6th Edition)
Ch. 18 - Match each costing system characteristic to job...Ch. 18 - Prob. 2TICh. 18 - Prob. 3TICh. 18 - Match each costing system characteristic to job...Ch. 18 - Prob. 5TICh. 18 - The Cutting Department has 6,500 units in process...Ch. 18 - Prob. 7TICh. 18 - Prob. 8TICh. 18 - Prob. 9TICh. 18 - Prob. 10TI
Ch. 18 - Prob. 11TICh. 18 - Castillo Company has three departments: Mixing,...Ch. 18 - Prob. 13TICh. 18 - Prob. 14TICh. 18 - Prob. 15TICh. 18 - Prob. 16TICh. 18 - Prob. 17TICh. 18 - Which company is least likely to use a process...Ch. 18 - Which characteristic is the same in both job order...Ch. 18 - Conversion costs are a. direct materials plus...Ch. 18 - Burton Company uses the weighted-average method in...Ch. 18 - Burton Company uses the weighted-average method in...Ch. 18 - Burton Company uses the weighted-average method in...Ch. 18 - The Assembly Department had 4,500 units of...Ch. 18 - The Mixing Department incurred the following costs...Ch. 18 - Department 1 completed work on 500 units and...Ch. 18 - The manager of Gilbert Company used the production...Ch. 18 - Which statement is accurate concerning the FIFO...Ch. 18 - What types of companies use job order costing...Ch. 18 - What types of companies use process costing...Ch. 18 - What are the primary differences between job order...Ch. 18 - List ways in which job order costing systems are...Ch. 18 - Describe the flow of costs through a process...Ch. 18 - What are equivalent units of production?Ch. 18 - Why is the calculation of equivalent units of...Ch. 18 - What are conversion costs? Why do some companies...Ch. 18 - What is a production cost report?Ch. 18 - What are the four steps in preparing a production...Ch. 18 - Explain the terms to account for and accounted...Ch. 18 - If a company began the month with 50 units in...Ch. 18 - Most companies using process costing systems have...Ch. 18 - What is the weighted-average method for process...Ch. 18 - Prob. 15RQCh. 18 - What is the purpose of the Costs Accounted For...Ch. 18 - What are transferred in costs? When do they occur?Ch. 18 - Prob. 18RQCh. 18 - Department 1 is transferring units that cost...Ch. 18 - Prob. 20RQCh. 18 - Describe ways the production cost report can be...Ch. 18 - Prob. 22RQCh. 18 - Describe the three groups of units that must be...Ch. 18 - Prob. 24RQCh. 18 - Prob. 1SECh. 18 - The Jimenez Toy Company makes wooden toys. The...Ch. 18 - Prob. 3SECh. 18 - Cadwell manufactures cell phones. The conversion...Ch. 18 - Spring Fresh produces premium bottled water....Ch. 18 - Prob. 6SECh. 18 - Prob. 7SECh. 18 - The Mixing Department of Complete Foods had 62,000...Ch. 18 - Prob. 9SECh. 18 - Refer to Short Exercises S18-8 and S18-9. Use...Ch. 18 - Prob. 11SECh. 18 - Prob. 12SECh. 18 - The Mixing Departments production cost report for...Ch. 18 - Prob. 14SECh. 18 - Spring Fresh produces premium bottled water....Ch. 18 - Prob. 16SECh. 18 - For each of the following products or services,...Ch. 18 - Prob. 18ECh. 18 - Complete the missing amounts and labels in the...Ch. 18 - Prob. 20ECh. 18 - Prob. 21ECh. 18 - Color Explosion prepares and packages paint...Ch. 18 - Shea Winery- in Pleasant Valley, New York, has two...Ch. 18 - Shea Winery- in Pleasant Valley, New York, has two...Ch. 18 - Complete the missing amounts in the following...Ch. 18 - On May 31, the Mixing Department ending...Ch. 18 - Refreshing Water Company produces premium bottled...Ch. 18 - Oxford Company had the following transactions in...Ch. 18 - Hartley Company has a production process that...Ch. 18 - Blue Ridge Mountain Manufacturing had the...Ch. 18 - Brians Frozen Pizzas uses FIFO process costing....Ch. 18 - Dee Electronics makes game consoles in three...Ch. 18 - Roan Paper Co. produces the paper used by...Ch. 18 - Prob. 34APCh. 18 - Carla (Carpet manufactures broadloom carpet in...Ch. 18 - Prob. 36APCh. 18 - Cheerful Colors manufactures crayons in a...Ch. 18 - Work Problem P18-33A using the FIFO method. The...Ch. 18 - Prob. 39BPCh. 18 - Smith Paper Co. produces the paper used by...Ch. 18 - Prob. 41BPCh. 18 - Casey Carpet manufactures broadloom carpet in...Ch. 18 - Sea Worthy uses three processes to manufacture...Ch. 18 - Happy Colors manufactures crayons in a three-step...Ch. 18 - Work Problem P18-40B using the FIFO method. The...Ch. 18 - Prob. 46PCh. 18 - Prob. 1TIATCCh. 18 - Billy Davidson operates Billys Worm Firm in...Ch. 18 - Rick Fines and Joe Lopez are the plant managers...
Knowledge Booster
Similar questions
- Schoen Corp. manufactures three types of electrical motors. Type A is sold upon completion of the production assembly. Types B and C can be sold after production or sent to a different plant for further processing to add various capabilities to the motors. The following data are available for each of the three types of motors at the beginning of the month: Units to be produced Total costs to produce before further processing Total sales revenue if sold immediately Additional processing costs Total sales revenue if processed further Additional profit (or loss) if B is processed further: $ A 10,000 $240,000 300,000 0 0 B 8,000 $250,000 320,000 30,000 340,000 6,000 $240,000 300,000 20,000 360,000arrow_forwardArona Corporation manufactures canoes in two departments, Fabrication and Waterproofing. In the Fabrication Department, fiberglass panels are attached to a canoe- shaped aluminum frame. The canoes are then transferred to the Waterproofing department to be coated with sealant. Arona uses a weighted-average process cost system to collect costs In both departments. All materlals in the Fabrication Department are added at the beginning of the production process. On July 1, the Fabrication Department had 30 canoes in process that were 20% complete with respect to conversion cost. On July 31, Fabrication had 20 canoes in process that were 40% complete with respect to conversion cost. During July, the Fabrication Department completed 84 canoes and transferred them to the Waterproofing Department. What are the Fabrication Department's equivalent units of production related to conversion costs for July? Multiple Cholce 76 92 114 104arrow_forwardArona Corporation manufactures canoes in two departments, Fabrication and Waterproofing. In the Fabrication Department, fiberglass panels are attached to a canoe- shaped aluminum frame. The canoes are then transferred to the Waterproofing department to be coated with sealant. Arona uses a weighted-average process cost system to collect costs in both departments. All materials in the Fabrication Department are added at the beginning of the production process. On July 1, the Fabrication Department had 30 canoes in process that were 20% complete with respect to conversion cost. On July 31, Fabrication had 20 canoes in process that were 40% complete with respect to conversion cost. During July, the Fabrication Department completed 73 canoes and transferred them to the Waterproofing Department. What are the Fabrication Department's equivalent units of production related to materials for July?arrow_forward
- Sam's Accessories uses four departments to produce handles for kitchen cabinets: Forming requires mixing the raw materials, Moulding, Spraying and Drying. After leaving the Drying Department, the handles are packaged and sent to the Finished Goods warehouse for shipment to retail outlets. The following data relates to the Spraying Department for the month of June: During the month, 2,000 handles valued at $275 each were transferred from the Molding Department to the Spraying Department. Other production costs incurred during the month are summarized as follows: Direct Materials Added Direct Manufacturing Wages Manufacturing Overhead $171,000 $425,600 $205,200 Process inspection occurs during the process and normally no losses are expected at this stage. However, during the month 200 handles were rejected at inspection. Rejected units from this department are sold as scrap at $400 each. These units had reached the following degree of completion: Transfer from Moulding 100%…arrow_forwardArona Corporation manufactures canoes in two departments, Fabrication and Waterproofing. In the Fabrication Department, fiberglass panels are attached to a canoe- shaped aluminum frame. The canoes are then transferred to the Waterproofing department to be coated with sealant. Arona uses a welghted-average process cost system to collect costs in both departments. All materials in the Fabrication Department are added at the beginning of the production process. On July 1, the Fabrication Department had 30 canoes in process that were 20% complete with respect to conversion cost. On July 31, Fabrication had 20 canoes in process that were 40% complete with respect to conversion cost. During July, the Fabrication Department completed 87 canoes and transferred them to the Waterproofing Department. What are the Fabrication Department's equivalent units of production related to materials for July? Multiple Cholce 95 79 117 107arrow_forwardCheetah Accessories uses four departments to produce handles for kitchen cabinets: Forming requires mixing the raw materials, Moulding, Spraying and Drying. After leaving the Drying Department, the handles are packaged and sent to the Finished Goods warehouse for shipment to retail outlets. The following data relates to the Spraying Department for the month of June: During the month, 2,000 handles valued at $275 each were transferred from the Molding Department to the Spraying Department. Other production costs incurred during the month are summarized as follows: Direct Materials Added Direct Manufacturing Wages Manufacturing Overhead $171,000 $425,600 $205,200 Process inspection occurs during the process and normally no losses are expected at this stage. However, during the month 200 handles were rejected at inspection. Rejected units from this department are sold as scrap at $400 each. These units had reached the following degree of completion: Transfer from Moulding 100% Direct…arrow_forward
- Rich company produces a variety of stationery products. One product, sealing wax sticks, passes through two processes: blending and molding. The weighted average method is used to account for the cost of production. Two ingredients, paraffin and pigment are added at the beginning of the process and heated and mixed for several hours. After blending, the resulting product is sent to the Molding department, where it is poured into molds and cooled. The following information relates to the blending process for November: a) Work in process, November 1, had 20,000 pounds, 20% complete with respect to conversion costs. Costs associated with partially completed units with: Paraffin : $ 120,000 Pigment : $ 100,000 Direct Labour : $ 30,000 Overhead applied : $ 10,000 b) Work in process, August 31, had 30,000 pounds, 70% complete with respect to conversion costs. c) Units completed and transferred out totalled 500,000 pounds. Costs…arrow_forwardRich company produces a variety of stationery products. One product, sealing wax sticks, passes through two processes: blending and molding. The weighted average method is used to account for the cost of production. Two ingredients, paraffin and pigment are added at the beginning of the process and heated and mixed for several hours. After blending, the resulting product is sent to the Molding department, where it is poured into molds and cooled. The following information relates to the blending process for November: a) Work in process, November 1, had 20,000 pounds, 20% complete with respect to conversion costs. Costs associated with partially completed units with: Paraffin : $ 120,000 Pigment : $ 100,000 Direct Labour : $ 30,000 Overhead applied : $ 10,000 b) Work in process, August 31, had 30,000 pounds, 70% complete with respect to conversion costs. c) Units completed and transferred out totalled 500,000 pounds. Costs…arrow_forwardDura-Conduit Corporation manufactures plastic conduit that is used in the cable industry. A conduit is a tube that encircles and protects the underground cable. In the process for making the plastic conduit, called extrusion, the melted plastic (resin) is pressed through a die to form a tube. Scrap is produced in this process. Information from the cost of production reports for three months is as follows, assuming that inventory remains constant: Assume that there is one-half pound of resin per foot of the finished product. a. Determine the resin materials cost per foot of finished product for each month. Round to the nearest whole cent. b. Determine the ratio of the number of resin pounds output in conduit by the number of pounds input into the process for each month. Round percentages to one decimal place. c. Interpret the resin materials cost per foot for the three months. Use the information in (a) and (b) to explain what is happening. d. Determine the conversion cost per foot of finished product for each month and interpret the result.arrow_forward
- Healthway uses a process-costing system to compute the unit costs of the minerals that it produces. It has three departments: Mixing, Tableting, and Bottling. In Mixing, at the beginning of the process all materials are added and the ingredients for the minerals are measured, sifted, and blended together. The mix is transferred out in gallon containers. The Tableting Department takes the powdered mix and places it in capsules. One gallon of powdered mix converts to 1,600 capsules. After the capsules are filled and polished, they are transferred to Bottling where they are placed in bottles, which are then affixed with a safety seal and a lid and labeled. Each bottle receives 50 capsules. During July, the following results are available for the first two departments (direct materials are added at the beginning in both departments): Overhead in both departments is applied as a percentage of direct labor costs. In the Mixing Department, overhead is 200 percent of direct labor. In the Tableting Department, the overhead rate is 150 percent of direct labor. Required: 1. Prepare a production report for the Mixing Department using the weighted average method. Follow the five steps outlined in the chapter. Round unit cost to three decimal places. 2. Prepare a production report for the Tableting Department. Materials are added at the beginning of the process. Follow the five steps outlined in the chapter. Round unit cost to four decimal places.arrow_forwardEyring Manufacturing produces a component used in its production of washing machines. The time to set up and produce a batch of the components is two days. The average daily usage is 800 components, and the maximum daily usage is 875 components. Required: Compute the reorder point assuming that safety stock is carried by Eyring Manufacturing. How much safety stock is carried by Eyring?arrow_forwardRDI Products Co. manufactures a variety of products made of plastic and aluminum components. During the winter months, substantially all of the production capacity is devoted to the production of lawn sprinklers for the following spring and summer seasons. Other products are manufactured during the remainder of the year. The company has developed standard costs for its several products. Standard costs for each year are set in the preceding October. The standard cost of a sprinkler for the current year is $3.70, computed as follows: During February, RDI Products manufactured 8,500 good sprinklers. The company incurred the following costs, which it charged to production: Materials price variations are not determined by usage but are charged to a materials price variation account at the time of purchase. All materials are carried in inventory at standard prices. Materials purchases for February were as follows: *Due to plastic shortages, the company was forced to purchase lower-grade plastic than called for in the standards. This increased the number of sprinklers rejected on inspection. Required: Calculate price and usage variances for each type of material and for labor, using the formulas on pages 421–422 and 424.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage LearningManagerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College PubPrinciples of Cost AccountingAccountingISBN:9781305087408Author:Edward J. Vanderbeck, Maria R. MitchellPublisher:Cengage Learning
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub
Principles of Cost Accounting
Accounting
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Cengage Learning