COST ACCOUNTING AND CONTROL
1st Term., A.Y. 2022 – 2023
Process Costing
Activity 4
NAME: (surname first) ________________________________ SCORE: __________________
YR./ SEC.: _________________ DATE: ___________
GENERAL DIRECTION:
Read and analyze the following questions and type your answer in the space provided for
each items.
Part I.
Vance Manufacturing Company began June 2011 with 10,000 units of inventory in process,
20 percent completed. During the period, 50,000 units were completed and transferred to the
finished goods warehouse. Ending inventory consisted of 5,000 units, 70 percent completed.
Materials were added at the beginning of the process.
Required:
Calculate the equivalent units for:
1. Materials costs under the weighted average process cost method.
2. Conversion costs under the weighted average process cost method.
3. Materials costs under the FIFO process cost method.
4. Conversion costs under the FIFO process cost method.
Part II.
Heap Company manufactures a product that passes through two processes: Fabrication and
Assembly. The following was obtained for the Fabrication Department for September:
a. All materials are added at the beginning of the process.
b. Beginning work in process had 80,000 units, 30% complete with respect to conversion
costs.
c. Ending work in process had 17,000 units, 25% complete with respect to conversion costs.
d. Started in process, 95,000 units
5. How much is the equivalent units of production for direct materials using the weighted
average method?
6. How much is the equivalent unit of production for conversion costs using weighted average
method?
7. How much is the equivalent units of production for direct materials using the FIFO method?
8. How much is the equivalent units of production for conversion costs using the FIFO method?
Part III.
Toyco manufactures a wooden toy product in a two-stage production process. Wood
material is brought into the Forming Department where it is shaped. Shaped products are
then moved to the Finishing Department where metal is added. The following data is given
for the Forming Department for April:
Units for April:
Work in process, beginning inventory April 1 300 units
Direct materials (100% complete)
Conversion (40% complete)
Units started in April: 2,200 units
Work in process, ending inventory April 30 500 units
Direct materials (100% complete)
Conversion (25%)
Costs for April:
Work in process, beginning inventory
Direct materials $7,100
Conversion $4,525
Costs added during April:
Direct materials $70,400
Conversion $40,100
Round to two decimal places.
Required:
9. How many units were transferred to Finishing?
10. How many units were started and completed during April?
11. How many equivalent units of conversion does it take to complete the beginning inventory in
the current period?
12. What is the FIFO cost assigned to the ending inventory?
13. What is the FIFO cost assigned to the units transferred out?
Part IV.
Xi Corporation produces a product that passes through two departments. For July, the
following equivalent unit schedule was prepared for the first department:
Materials Conversion
Units completed 180,000 180,000
Units, EWIP ´ fraction complete:
10,000 x 100% 15,000
10,000 x 40% 6,000
Equivalent units of output 195,000 186,000
Costs assigned to beginning work in process:
Materials: $51,000
Conversion: $24,750
Manufacturing costs incurred during the month:
Materials: $56,250
Conversion: $45,000
Required:
14. Compute the unit cost for July using the weighted average method.
15. Determine the cost of goods transferred out.
16. Determine the cost of ending work in process.
Part V.
Fordman Company has a product that passes through two processes: Grinding and
Polishing. During December, the Grinding Department transferred 20,000 units to the
Polishing Department. The cost of the units transferred into the second department was
$40,000. Direct materials are added uniformly in the second process. Units are measured
the same way in both departments.
The second department (Polishing) had the following physical flow schedule for December:
Units to account for:
Units, beginning work in process 4,000 40% complete
Units started ?
Total units to account for ?
Units accounted for:
Units, ending work in process 8,000 50% complete
Units completed ?
Units accounted for ?
Costs in beginning work in process for the Polishing Department were direct materials,
$5,000; conversion costs, $6,000; and transferred in, $8,000. Costs added during the month:
direct materials, $32,000; conversion costs, $50,000; and transferred in, $40,000.
Required:
17. Assuming the use of the weighted average method, compute the unit cost for the month
18. Assume the company uses the FIFO method, compute the unit cost for the month.
Part VI.
Larkin Company produces leather strips for western belts using three processes: cutting,
design and coloring and punching. The weighted average method is used for all three
departments. The following information pertains to the Design and Coloring Department for
the month of June:
a. There was no beginning work in process.
b. There were 400,000 units transferred in from the Cutting Department.
c. Ending work in process, June 30: 50,000 strips, 80% complete with respect to
conversion costs.
d. Units completed and transferred out: 330,000 strips. The following costs were added
during the month:
Transferred in $2,000,000
Direct materials 600,000
Conversion costs 780,000
e. Direct materials are added at the beginning of the process.
f. Inspection takes place at the end of the process. All spoilage is considered normal
Required:
19. Calculate equivalent units of production for transferred-in materials.
20. Calculate the equivalent units of production for direct materials added.
21. Calculate the equivalent units of production for conversion costs
22. Calculate the unit cost for transferred in materials
23. Calculate the unit costs for direct materials.
24. Calculate the unit cost for conversion cost.
25. What is the total cost of units transferred out?
26. What is the cost of ending work in process inventory?
27. Assume that all spoilage is considered abnormal? How much is the cost of units transferred
out?
28. Assume that 80% of the units spoiled are abnormal and 20% are normal spoilage. How
much is the loss charged to abnormal loss account?
29. Assume that 80% of the units spoiled are abnormal and 20% are normal spoilage. How
much is the loss that would be assigned to the cost of goods transferred
