Question

managerial accountign

Prem 240 pits em Materials at the beginning of the process and conversion coses are umitiamily incum . At the beginning of September, work in process of Cleaning Deputeti cumlete the end of the month is complete. Other data Cleaning Department for the month include: Conversion 1.800 units SI54.000 $82,080 led during September Total cost added during September $260,000 $200,000 Required Calculate the costs allocated to the completed units and the ending work-in-process with supporting schedules using the weighted average method of process costing. - Extra Problem 21 extra points) Calculate the costs allocated to the completed units and the ending work-in- process with supporting schedules using the first-in-first-out (FIFO) method of process costing

Answer 1

Solution Weighted Average method of Process Costing Beginning Work in process units Units started during September Units completed and transferred out during September Ending Work in process units (1,600 +2,000 - 3,200) Units started and completed during September (3,200 - 1,600) 1,600 units 2,000 units 3,200 units 400 units 1,600 units Step 1 : Compute the Equivalent units of production for Material and Conversion Physical unit EUP-Materials EUP-Conversion cost 1,600 1,600 1,600 Beginning Work in process Materials (1,600 x 100%) Conversion cost (1,600 x 100%) 1,600 1,600 1,600 Units started and completed Materials (1,600 x 100%) Conversion cost (1,600 x 100%) Units completed and transferred out 3,200 3,200 3,200 Ending Work in process Materials (400 x 100%) Conversion cost (400 x 60%) 400 400 240 Equivalent units of production 3,600 3,440 Step 2: Compute the cost per equivalent unit production (EUP) Beginning Work in process cost Cost added during September Total cost to account for Equivalent unit of production Cost per Equivalent unit Materials $154,000 $260,000 $414,000 3,600 $115.00 Conversion cost $82,080 $200,000 $282,080 3,440 $82.00 Total Cost $236,080 $460,000 $696,080 $197.00 Step 3: Compute the cost of units completed and transferred out during september Materials Conversion cost Total Cost Units completed and transferred out 3,200 3,200 Cost per equivalent unit $115.00 $82.00 Cost of Units completed and transferred out $368,000 $262,400 $630,400

Step 4: Compute the cost of ending work-in-process inventory | Materials Conversion cost | Total cost Ending WIP - Equivalent units 400 240 Cost per equivalent unit $115.00 $82.00 Cost of ending WIP inventory $46,000 $19,680 $65,680 Final answers Cost allocated to the completed units Cost allocated to the ending work-in-process $630,400 $65,680 FIFO method of Process Costing Beginning Work in process units Units started during September Units completed and transferred out during September Ending Work in process units (1,600 +2,000 - 3,200) Units started and completed during September (3,200 -1,600) 1,600 units 2,000 units 3,200 units 400 units 1,600 units Step 1: Compute the Equivalent units of production for Material and Conversion Physical unit EUP-Materials EUP-Conversion cost 960 1,600 Beginning Work in process Materials (1,600 x 0%) Conversion cost (1,600 x (100%-40%)) 1,600 1,600 1,600 Units started and completed Materials (1,600 x 100%) Conversion cost (1,600 x 100%) Units completed and transferred out 3,200 1,600 2,560 Ending Work in process Materials (400 x 100%) Conversion cost (400 x 60%) 400 400 240 Equivalent units of production 2,000 2,800

Step 2: Compute the cost per equivalent unit production (EUP) Total Cost Cost added during September Equivalent unit of production Cost per Equivalent unit Materials $260,000 2,000 $130.00 Conversion cost $200,000 2,800 $71.43 $201.43 Step 3: Compute the cost of units completed and transferred out during september Materials $154,000 Conversion cost $82,080 Total Cost $236,080 Beginning Work in process cost $0 $68,571 $68,571 Cost added to complete the beginnig WIP Materials (0 x $130) Comversion cost (960 x $71.43) Cost of completed beginning WIP units $154,000 $150,651 $304,651 $208,000 $114,286 $322,286 Units started & completed during september Materials (1600 x $130) Comversion cost (1600 x $71.43) Cost of Units completed and transferred out $362,000 $264,937 $626,937 Step 4: Compute the cost of ending work-in-process inventory Materials Conversion cost Total cost Ending WIP - Equivalent units 400 240 Cost per equivalent unit $130.00 $71.43 Cost of ending WIP inventory $52,000 $17,143 $69,143 Final answers Cost allocated to the completed units Cost allocated to the ending work-in-process $626,937 $69,143