2. Question One
• Which of the following companies would be most likely to use a process costing system?
• Oil Refinery
3. Question Two
• The following information relates to the Blending Department of Kedakai Products
Corporation for the month of May. Kedakai uses a weighted-average process costing
system.
• What are the Blending Department’s equivalent units related to materials for May?
• 307000
Work in process, beginning (May 1):
Units in Process 30000
Percent Complete with respect to materials 100%
Percent complete with respect to conversion 10%
Units completed and transferred out during May 290000
Work in process, ending (May 31):
Units in process 17000
Percent complete with respect to materials 100%
Percent complete with respect to conversion 80%
4. Work for Question Two
• Equivalent units= units transferred to the next department+ equivalent units in ending
Work in Process inventory
• Units transferred for materials= 290000 (see chart)
• Equivalent units in ending WIP= 17000 (17000*100%)
• 290000+17000= 307000
5. Question Three
• Hache Corporation uses the weighted-average method in its process costing system.
Data concerning the first processing department for the most recent month are listed
below. What are the equivalent units for materials for the month in the first processing
department?
• 5150 Beginning Work in Process Inventory:
Units in beginning work in process inventory 700
Material costs $8000
Conversion costs $7800
Percent complete with respect to materials 50%
Percent complete with respect to conversion 35%
Units started into production during the month 5200
Units transferred to the next department during the month 4400
Materials cost added during the month $90300
Conversion costs added during the month $125600
Ending work in process inventory
Units in ending work in process inventory 1500
Percent complete with respect to materials 50%
Percent complete with respect to conversion 30%
6. Work for Question Three
• Equivalent units= units transferred to the next department+ equivalent units in ending
Work in Process inventory
• Units transferred= 4400 (see chart)
• Ending units in WIP inventory= 750 (1500*50%)
• 440+750= 5150
7. Question Four
• Fulton Corporation uses the weighted-average method in its process costing system. This
month, the beginning inventory in the first processing department consisted of 800 units.
The cost and percentage completion of these units in beginning inventory were:
• A total of 9900 units were started and 8900 units were transferred to the second
processing department during the month. The following costs were incurred in the first
processing department during the month:
Costs Percent Complete
Material costs $7800 65%
Conversion costs $7600 35%
Materials Cost $128600
Conversion costs $220800
8. • The ending inventory was 70% complete with respect to materials and 60% complete with
respect to conversion costs.
• The total cost transferred form the first processing department to the next processing
department during the month is closest to:
• $323168
9. Work for Question Four
• Total Cost transferred= (units transferred to next department)(Cost per equivalent unit)
• Cost per equivalent unit= (total cost)/(Equivalent units of production?
• Total cost= cost of beginning WIP inventory+ Costs added during the period
• Equivalent units of production= units transferred to next department+ ending WIP
inventory
• End WIP inventory=
• Beg inventory+ Started/Transferred In Inventory= Ending Inventory+ Transferred Out
• Plug in numbers and solve for ending inventory
10. Materials Conversion Total
Units completed and transferred out:
Units transferred to next department (A) 8900 8900
Cost of beginning WIP inventory 7800 7600
Cost added during period 128600 220800
Total cost (a) 136400 228400
Units transferred to next department 8900 8900
End WIP Inventory (* 1800)
Materials: (1800*70%) 1260
Conversion: (1800*60%) 1080
Equivalent Units of Production (b) 10160 9980
Cost per Equivalent Units (a/b) (B) $13.425 $22.88577
Cost of units transferred out (A*B) 119484.252 203683.3667
Total $323167.6187
11. Question Five
• Ibarra Corporation uses the weighted average method in its process costing system. Data
concerning the first processing department for the most recent month are listed below.
The cost per equivalent unit for materials for the month in the first processing department
is closest to:
• $13.20
Beginning Work in Process Inventory:
Units in beginning work in process inventory 800
Material costs $7700
Conversion costs $3500
Percent complete with respect to materials 60%
Percent complete with respect to conversion 10%
Units started into production during the month 7800
Units transferred to the next department during the month 6800
Materials cost added during the month $101100
Conversion costs added during the month $271100
Ending work in process inventory
Units in ending work in process inventory 1800
Percent complete with respect to materials 80%
Percent complete with respect to conversion 15%
12. Work for Question Five
• Cost per Equivalent Unit= (cost of beginning WIP inventory+ cost added during period)/
Equivalent units of production
• Equivalent Units of Production= units transferred to next department+ Equivalent units in
ending WIP inventory
• EU of production= 6800+ (1800*80%)= 8240
• Cost per EU= (7700+101100)/8240
• $13.20
13. Question Six
• Valley Manufacturing Corporation’s beginning work in process inventory consisted of
10000 units, 100% complete with respect to materials cost and 40% complete with
respect to conversion costs. The total cost in the beginning inventory was $30000. During
the month, 50000 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, the total cost of the units complete and transferred out was:
• $285000
14. Work for Question Six
• Total cost of units completed and transferred out= equivalent unit cost * units transferred
out
• Materials cost of units transferred out= (2*50000)= 100000
• Conversion cost of units transferred out= (3.7*50000)= 185000
• 100000+185000= 285000
15. Question Seven
• Cameron Corporation uses the weighted-average method in its process costing system.
This month, the beginning inventory in the first processing department consisted of 700
units. The cost and percentage completion of these units in beginning inventory were:
• A total of 7900 units were started and 6900 units were transferred to the second
processing department during the month. The following costs were incurred in the first
processing department during the month:
Costs Percent Complete
Material costs $16400 85%
Conversion costs $9200 60%
Materials costs $171500
Conversion costs $137100
16. • The ending inventory was 70% complete with respect to materials and 35% complete with
respect to conversion costs.
• The cost per equivalent unit for materials for the month in the first processing department
is closest to:
• $23.23
17. Work for Question Seven
• Cost per equivalent unit= total costs/equivalent units of production
• Total cost= cost of beginning WIP inventory+ costs added during the period
• Equivalent units of production= units transferred to next department+ ending WIP
inventory
• Total cost= 16400+171500= 187900
• Ending WIP inventory= 1700*70%= 1190
• Equivalent units of production= 6900+ 1190= 8090
• Cost per equivalent unit= 187900/8090= $23.23
18. Question Eight
• Acklac Corporation uses the weighted-average method in its process costing system. This
month, the beginning inventory in the first processing department consisted of 700 units.
The cost and percentage completion of these units in beginning inventory were:
• A total of 9200 units were started and 8300 units were transferred to the second
processing department during the month. The following costs were incurred in the first
processing department during the month:
Costs Percent Complete
Material costs $12000 65%
Conversion costs $2000 10%
Materials Cost $200800
Conversion costs $225500
19. • The ending inventory was 705% complete with respect to materials and 15% complete
with respect to conversion costs.
• The cost of ending work in process inventory in the first processing department according
to the company's cost system is closest to:
• $33273
20. Work for Question Eight
• Cost of ending WIP inventory= ending WIP inventory * cost per equivalent units of
production
• Ending WIP inventory= units in ending WIP inventory * percentage complete
• Cost per equivalent unit= total costs/ equivalent units of production
• Total costs= costs of beginning WIP inventory+ costs added
• Equivalent Units of Production= units transferred to next department+ Ending WIP
iventory
• End WIP inventory=
• Beg inventory+ Started/Transferred In Inventory= Ending Inventory+ Transferred Out
• Plug in numbers and solve for ending inventory
21. Materials Conversion Total
Ending Work in process inventory:
Equivalent Units of Production
1600* 75% 1200
1600 * 15% 240
Cost per Equivalent Unit:
Cost of beginning WIP inventroy 12000 2000
Costs added 200800 225500
Total Costs 212800 227500
Equivalent Units of Production:
Units transferred to next department 8200 8300
Ending WIP inventory 1200 240
Equivalent Units of Production 9500 8540
Cost per Equivalent Production:
212800/9500 22.4
227500/8540 26.639
Cost of Ending WIP Inventory: 26880 6393.443 33273.44262
22. Question Nine
• Pulo Corporation uses a weighted-average process costing system. The company has
two processing departments. Production starts in the Assembly Department and is
completed in the Finishing Department. The units complete and transferred out of the
Assembly department during April will become the:
• Units started in production in Finishing for April
23. Question Ten
• Guo Corporation uses the weighted-average method in its process costing system. This
month, the beginning inventory in the first processing department consisted of 500 units.
The cost and percentage completion of these units in beginning inventory were:
• A total of 9700 units were started and 9100 units were transferred to the second
processing department during the month. The following costs were incurred in the first
processing department during the month:
Costs Percent Complete
Material costs $7300 55%
Conversion costs $2100 10%
Materials Cost $237800
Conversion costs $376400
24. • The ending inventory was 85% complete with respect to materials and 75% complete with
respect to conversion costs.
• What are the equivalent units for materials for the month in the first processing
department?
• 10035
25. Work for Question Ten
• Equivalent Units= units transferred to next department+ units in ending work in process
inventory
• Units transferred to next department= 9100
• Units in ending work in process inventory= 935
• 1100*85%
• 9100+935= 10035
