Exam 6: Systems Design: Process Costing

Valley Manufacturing Company's beginning work-in-process inventory consisted of 10,000 units,100% complete with respect to materials cost and 40% complete with respect to conversion costs.The total cost in the beginning inventory was $30,000.During the month,50,000 units were transferred out.The equivalent unit cost was computed to be $2.00 for materials and $3.70 for conversion costs under the weighted-average method.Given this information,what was the total cost of the units completed and transferred out?

(Appendix 6B)The cost per equivalent unit will be greater when normal losses are charged to good output than when they are charged to manufacturing overhead.

A manufacturer of blank DVDs would ordinarily use process costing rather than job-order costing.

(Appendix 6A)Assuming that the company uses the FIFO cost method,what is the cost per equivalent unit for conversion costs for June,rounded to the nearest cent?

$112,000 ÷ 28,000 EUs = $4 per EU

Using the weighted-average method,what are the equivalent units of production for labour and overhead for the month?

Barker Inc.uses the weighted-average method in its process costing system.The following data concern the operations of the company's first processing department for a recent month: Required: Using the weighted-average method: a)Determine the equivalent units of production for materials and conversion costs. b)Determine the cost per equivalent unit for materials and conversion costs. c)Determine the cost of units transferred out of the department during the month. d)Determine the cost of ending work-in-process inventory in the department.

Strap Company uses the weighted-average method in its process costing system.The company has only one processing department.The ending work-in-process inventory consists of 10,000 units,60% complete with respect to materials.The total dollar value of this inventory is $38,000.The costs per equivalent unit are $5.00 for materials and $4.00 for conversion costs for the period.With respect to conversion costs,what is the ending work-in-process inventory?

(Appendix 6B)Assuming normal losses are charged to good output the production report will account for lost units but not assigned a value in equivalent units.

(Appendix 6A)The cost per equivalent unit for conversion costs will always be the same under both the FIFO and the weighted-average methods if there is no ending work-in-process inventory.

(Appendix 6A)Karmen Company uses the FIFO method in its process costing system.Operating data for the Enamelling Department for the month of May appear below: What were the equivalent units of production for conversion costs in the Enamelling Department for May?

Rariton Company uses the weighted-average method in its process costing system.The Moulding Department is the second department in its production process.The data below summarize the department's operations in January: The Moulding Department's production report indicates that the cost per equivalent unit for conversion cost for January was $5.37. How much conversion cost was assigned to the ending work-in-process inventory in the Moulding Department for January?

(Appendix 6A)Using the FIFO method,the cost per equivalent unit of materials for May is closest to which of the following?

What are the equivalent units of production for material for the month?

(Appendix 6A)Ebis Company uses the FIFO method in its process costing system.The first processing department,the Welding Department,started the month with 13,000 units in its beginning work-in-process inventory;10% of the units were complete with respect to conversion costs.The conversion cost in this beginning work-in-process inventory was $12,610.An additional 89,000 units were started into production during the month.There were 22,000 units in the ending work-in-process inventory of the Welding Department;30% of these units were complete with respect to conversion costs.A total of $806,085 in conversion costs were incurred in the department during the month. What would be the cost per equivalent unit for conversion costs for the month on the department's production report? (Round off to three decimal places. )

Harker Company uses the weighted-average method in its process costing system.The first processing department,the Welding Department,started the month with 16,000 units in its beginning work-in-process inventory that were 40% complete with respect to conversion costs.The conversion cost in this beginning work-in-process inventory was $29,440.An additional 59,000 units were started into production during the month,and 61,000 units were completed in the Welding Department and transferred to the next processing department.There were 14,000 units in the ending work-in-process inventory of the Welding Department that were 10% complete with respect to conversion costs.A total of $246,400 in conversion costs were incurred in the department during the month. What would be the cost per equivalent unit for conversion costs for the month? (Round off to three decimal places. )

(Appendix 6A)Easy Inc.uses the FIFO method in its process costing system.The following data concern the operations of the company's first processing department for a recent month: Required: Using the FIFO method: a)Determine the equivalent units of production for materials and conversion costs. b)Determine the cost per equivalent unit for materials and conversion costs. c)Determine the cost of units transferred out of the department during the month. d)Determine the cost of ending work-in-process inventory in the department.

Using the weighted-average method,the cost per equivalent unit of conversion cost for May is closest to which of the following?

Using the weighted-average method,the cost per equivalent unit of materials for May is closest to which of the following?

In process costing,the same equivalent units figure is used for both materials and conversion costs.