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STUDENT’S HANDOUT

ADVANCED FINANCIAL ACCOUNTING AND REPORTING Josart B. Tubay, CPA, MBA

AFAR713 Process Costing Batch MAY 2023

L E C T U R E N O T E S

PROCESS COSTING
Characteristics
1. Cost are accumulated by department.
2. Each department had its own WIP control account
3. EUP are used to restate WIP
4. Completed units will be transferred to the next
department
5. Total cost and unit cost are periodically calculated

Methods
• FIFO – cost of beginning WIP are separated and assumed
to be completed first. Cost per EUP is based on the cost this
period.
• Weighted Average – all costs (beginning and cost this
period) are aggregated in computing for the cost per EUP.

Application of Manufacturing Cost

• Materials – may be applied evenly but sometimes it is
applied based on specific point in the production process.
• Conversion cost – applications are evenly throughout the
period. (in most cases)

Production Losses
Occurrence
• Continuous – cannot be identified specifically within the
production. Usually they are normal losses and uses the
Method of Neglect.
• Discrete – can be identified when the loss occur. It is
usually determined during inspection point. It may be a
normal loss or abnormal loss

Types of losses
• Normal Loss – expected loss, anticipated and predicted.
Reported as a product cost.
o Charged to all good units (transferred out and Ending
WIP) if it is continuous loss or both the completed
units and ending WIP passed the inspection point.
o Charged to completed units only if only the completed
units passed the inspection point.
• Abnormal loss – unexpected or may be an excess of normal
loss. Charged to FOH Control.
o Always discrete and charged to FOH upon discovery at
inspection points.

******end of lecture notes******

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L E C T U R E P R O B L E M S 6. Refer to Formal Corporation. Calculate equivalent units of

production for conversion using FIFO.
Units Accounted For a. 30,125
1. Styles Company transferred 6,000 units to Finished Goods b. 34,325
Inventory during August. On August 1, the company had c. 37,125
400 units on hand (35 percent complete as to both d. 39,000
material and conversion costs). On August 31, the
company had 750 units (20 percent complete as to 7. Refer to Formal Corporation. Calculate equivalent units of
material and 30 percent complete as to conversion costs). production for material using weighted average.
The number of units started and completed during August a. 32,000
was: b. 34,325
a. 5,600 c. 37,125
b. 5,860 d. 39,000
c. 6,000
d. 6,750 8. Refer to Formal Corporation. Calculate equivalent units of
production for conversion using weighted average.
2. Editha Company started 8,600 units in April. The company a. 34,325
transferred out 6,400 finished units and ended the period b. 37,125
with 3,200 units that were 40 percent complete as to both c. 38,375
material and conversion costs. Beginning Work in Process d. 39,925
Inventory units were
a. 400. 9. Refer to Formal Corporation. Calculate equivalent units of
b. 1,000. production for materials using FIFO assuming that all
c. 1,280. materials are added when 20% complete.
d. 2,200. a. 32,000
b. 36,500
3. Dictate Company had beginning Work in Process Inventory c. 33,700
of 5,000 units that were 40 percent complete as to d. 29,500
conversion costs. PRIA Company started and completed
42,000 units this period and had ending Work in Process 10. Refer to Formal Corporation. Calculate equivalent units of
Inventory of 12,000 units. How many units were started production for materials using FIFO assuming that all
this period? materials are added when 50% complete.
a. 42,000 a. 32,000
b. 47,000 b. 36,500
c. 54,000 c. 33,700
d. 59,000 d. 29,500

FIFO and Average 11. Refer to Formal Corporation. Calculate equivalent units of
Uneven Application production for materials using FIFO assuming that 40% of
THE NEXT ITEM(S) IS/ARE BASED ON THE FOLLOWING materials are added when 40% complete and the balance
Formal Corporation adds material at the start to its production when 90% complete
process and has the following information available for August: a. 32,000
b. 36,500
Beginning Work in Process Inventory 7,000 units c. 33,700
(40% complete as to conversion) d. 29,500
Started this period 32,000 units
Ending Work in Process Inventory Cost Accounted for
(25% complete as to conversion) 2,500 units THE NEXT ITEM(S) IS/ARE BASED ON THE FOLLOWING
Transferred out ? Manager Company adds all material at the start of production.
The following production information is available for
4. Refer to Formal Corporation. Compute the number of units September:
started and completed in August.
a. 29,500 Beginning Work in Process Inventory 10,000 units
b. 34,500 (45% complete as to conversion)
c. 36,500 Started this period 120,000 units
d. 39,000 Ending Work in Process Inventory
(80% complete as to conversion) 8,200 units
5. Refer to Formal Corporation. Calculate equivalent units of
production for material using FIFO. Beginning Work in Process Inventory Costs
a. 32,000 Materials P24,500
b. 36,800 Conversion 68,905
c. 37,125 Current period costs
d. 39,000 Materials P75,600
Conversion 130,053

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12. Refer to Manager Company. How many units must be 21. Refer to Manager Company. What is the cost of units
accounted for? completed using the weighted average method?
a. 118,200 a. P237,510
b. 128,200 b. P266,742
c. 130,000 c. P278,400
d. 138,200 d. P282,576

13. Refer to Manager Company. What is the total cost to 22. Refer to Manager Company. What is the conversion cost
account for? per equivalent unit using the FIFO method?
a. P 93,405 a. P1.05
b. P205,653 b. P.95
c. P274,558 c. P1.61
d. P299,058 d. P1.55

14. Refer to Manager Company. How many units were started 23. Refer to Manager Company. What is the cost of all units
and completed in the period? transferred out using the FIFO method?
a. 111,800 a. P204,624
b. 120,000 b. P191,289
c. 121,800 c. P287,004
d. 130,000 d. P298,029

15. Refer to Manager Company. What are the equivalent units THE NEXT ITEM(S) IS/ARE BASED ON THE FOLLOWING
for material using the weighted average method? Oxford Manufacturing Inc. has the following production data
a. 120,000 for the month of April 2023:
b. 123,860
c. 128,360 Units Department 1 Department 2
d. 130,000 Beginning WIP, (1/3 incomplete) 15,000
Beginning WIP, (1/3 complete) 9,000
16. Refer to Manager Company. What are the equivalent units Transferred to next department 30,000
for material using the FIFO method? Ending WIP, (3/5 incomplete) 5,000
a. 111,800 Ending WIP, (7/8 complete) 8,000
b. 120,000
c. 125,500 Costs
d. 130,000 Beginning WIP
Cost from preceding P9,000
17. Refer to Manager Company. What are the equivalent units department
for conversion using the weighted average method? Direct Materials P8,145 3,996
a. 120,000 Direct Labor 3,315 1,998
b. 123,440 Factory Overhead 1,050 1,332
c. 128,360 Cost added this month
d. 130,000 Direct Materials P10,860 P30,636
Direct Labor 7,309 23,310
18. Refer to Manager Company. What are the equivalent units Factory Overhead 2,534 15,540
for conversion using the FIFO method?
a. 118,360 In department 1, all materials are added at the start of the
b. 122,860 process while labor and overhead are applied evenly
c. 123,860 throughout the process. In department 2, 50% of materials are
d. 128,360 added at the start of the process and the balance is added when
the process in ¾ complete. Conversion costs are applied
19. Refer to Manager Company. What is the material cost per uniformly to the process. (Round-off the cost per EUP to 4-
equivalent unit using the weighted average method? decimal places)
a. P.58
b. P.62 24. Using weighted average, what is the cost of transferred out
c. P.77 to Department 2?
d. P.82 a. 29,610 c. 22,794
b. 3,603 d. 92,628
20. Refer to Manager Company. What is the conversion cost
per equivalent unit using the weighted average method? 25. Using weighted average, what is the cost of transferred out
a. P1.01 to finished goods?
b. P1.05 a. 29,610 c. 22,794
c. P1.55 b. 3,603 d. 92,628
d. P1.61
Accounting for Losses
THE NEXT ITEM(S) IS/ARE BASED ON THE FOLLOWING
The following information is available for Egg Corporation for
the current month:

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Started this month 33. Refer to Egg Corporation. What is cost per equivalent unit
Beginning WIP (40% complete) 80,000 units for conversion costs using weighted average?
Normal spoilage (discrete) 1,100 units a. P4.19
Abnormal spoilage 900 units b. P4.41
Ending WIP (70% complete) 13,000 units c. P4.55
Transferred out 7,200 units d. P4.35

Beginning Work in Process Costs 34. Refer to Egg Corporation. What is the cost assigned to
Material P10,400 ending inventory using FIFO?
Conversion 13,800 a. P75,920
Current costs b. P58,994
Material P120,000 c. P56,420
Conversion 350,000 d. P53,144

All materials are added at the start of production and the 35. Refer to Egg Corporation. What is the cost assigned to
inspection point is at the end of the process. abnormal spoilage using FIFO?
a. P1,350
26. Refer to Egg Corporation. What are equivalent units of b. P3,906
production for material using FIFO? c. P5,256
a. 80,000 d. P6,424
b. 79,100
c. 78,900 36. Refer to Egg Corporation. What is the cost assigned to
d. 87,500 normal spoilage and how is it classified using weighted
average?
27. Refer to Egg Corporation. What are equivalent units of a. P6,193 allocated between WIP and Transferred Out
production for conversion costs using FIFO? b. P6,424 allocated between WIP and Transferred Out
a. 79,700 c. P6,193 assigned to loss account
b. 79,500 d. P6,424 assigned to units Transferred Out
c. 81,100
d. 80,600 37. Refer to Egg Corporation. What is the total cost assigned to
goods transferred out using weighted average?
28. Refer to Egg Corporation. What are equivalent units of a. P435,080
production for material using weighted average? b. P429,824
a. 86,600 c. P428,656
b. 87,500 d. P423,400
c. 86,400
d. 85,500 THE NEXT ITEM(S) IS/ARE BASED ON THE FOLLOWING
Fried Concept manufactures small tables in its Processing
29. Refer to Egg Corporation. What are equivalent units of Department. Direct materials are added at the initiation of the
production for conversion costs using weighted average? production cycle and must be bundled in single kits for each
a. 83,600 unit. Conversion costs are incurred evenly throughout the
b. 82,700 production cycle. Before inspection, some units are spoiled due
c. 82,500 to non-detectible materials defects. Inspection occurs when
d. 81,600 units are 50% converted. Spoiled units generally constitute 5%
of the good units. Data for December 2020 are as follows:
30. Refer to Egg Corporation. What is cost per equivalent unit
for material using FIFO? WIP, beginning inventory 12/1/2023 10,000 units
a. P1.63 Direct materials (100% complete)
b. P1.37 Conversion costs (75% complete)
c. P1.50 Started during December 40,000 units
d. P1.56 Completed and transferred out 12/31/2023 38,400 units
WIP, ending inventory 12/31/2023 8,000 units
31. Refer to Egg Corporation. What is cost per equivalent unit Direct materials (100% complete)
for conversion costs using FIFO? Conversion costs (65% complete)
a. P4.00
b. P4.19 Costs for December
c. P4.34 WIP, beginning Inventory
d. P4.38 Direct materials P50,000
Conversion costs 30,000
32. Refer to Egg Corporation. What is cost per equivalent unit Direct materials added 100,000
for material using weighted average? Conversion costs added 140,000
a. P1.49
b. P1.63 38. What is the number of total spoiled units?
c. P1.56 a. 1,600 units
d. P1.44 b. 2,000 units
c. 2,700 units
d. 3,600 units

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39. Normal spoilage totals 44. Compute the cost of units completed from the In-Process,
a. 1,600 units. April 1
b. 2,000 units. A. P25,346
c. 2,320 units. B. P25,364
d. 2,700 units C. P 25,436
D. P 25,463
40. Abnormal spoilage totals
a. 1,280 units. 45. Compute the cost of units completed from those received
b. 2,000 units. during April
c. 1,680 units. A. P 84,790
d. 1,920 units. B. P 84,970
C. P 87,490
41. What is the total cost per equivalent unit using the D. P 89,470
weighted-average method of process costing?
a. P3.00 46. Compute the cost of units lost from the In-process, April 1
b. P3.60 A. P 595
c. P6.60 B. P 599
d. P6.74 C. P 959
D. P 995
42. What cost is allocated to abnormal spoilage using the
weighted-average process-costing method? 47. Compute the cost of units lost from those received during
a. P6,236.48 April
b. P 7,360 A. P 9,459
c. P11,088 B. P 9,549
d. P16,400 C. P 9,945
D. P 9,954
43. What are the amounts of direct materials and conversion
costs assigned to ending work in process using the 48. Compute the cost of units still in process at April 30, 2023
weighted-average process-costing method? A. P45,680
a. P18,720; P24,000 c. P25,200; P20,220 B. P46,850
b. P22,900; P19,820 d. P28,560; P14,160 C. P48,560
D. P48,650
THE NEXT ITEM(S) IS/ARE BASED ON THE FOLLOWING
Fast Manufacturing uses process costing in its manufacturing **end of Lecture Problems***
operations and adopts the FIFO method in costing its
production. In Department 2, conversion costs are incurred MULTIPLE CHOICE THEORY
uniformly throughout the process. Materials are added
following inspection, which occurs at the 90% stage of 1. Which cost accumulation procedure is most applicable in
completion. In view of the simplicity of the production process, continuous mass-production manufacturing
losses are not expected, thus any spoiled units are deemed environments?
abnormal and their costs charged to Factory Overhead Control a. standard c. process
account. b. actual d. job order

The following information relates to Department 2 for April 2. Process costing is used in companies that
2023. a. engage in road and bridge construction.
b. produce sailboats made to customer specifications.
Units Pesos c. produce bricks for sale to the public.
In process, April 1 (40% converted) 2,000 P16,000 d. construct houses according to customer plans.
Received from Department 1 12,000 84,000
Transferred to finished product 8,000 3. A producer of ____ would not use a process costing
In process, April 30 (70% converted) 5,000 system.
Lost units (100 units from in process, April 1,000 a. gasoline c. blank videotapes
1) b. potato chips d. stained glass windows

Costs incurred in Department 2 during the current month are 4. A process costing system is used by a company that
given below a. produces heterogeneous products.
b. produces items by special request of customers.
Materials P24,000 c. produces homogeneous products.
Labor and overhead 45,240 d. accumulates costs by job.

Assume the following unit costs for April were determined from 5. Which is the best cost accumulation procedure to use for
the above-mentioned information. continuous mass production of like units?
a. actual c. job order
Preceding department P7.00 b. standard d. process
Materials 3.00
Labor and overhead 3.90
Total P13.90

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6. Equivalent units of production are equal to the 13. To compute equivalent units of production using the FIFO
a. units completed by a production department in the method of process costing, work for the current period
period. must be stated in units
b. number of units worked on during the period by a a. completed during the period and units in ending
production department. inventory.
c. number of whole units that could have been b. completed from beginning inventory, units started
completed if all work of the period had been used to and completed during the period, and units partially
produce whole units. completed in ending inventory.
d. identifiable units existing at the end of the period in a c. started during the period and units transferred out
production department. during the period.
d. processed during the period and units completed
7. In a process costing system using the weighted average during the period.
method, cost per equivalent unit for a given cost
component is found by dividing which of the following by 14. The FIFO method of process costing will produce the same
EUP? cost of goods transferred out amount as the weighted
a. only current period cost average method when
b. current period cost plus the cost of beginning a. the goods produced are homogeneous.
inventory b. there is no beginning Work in Process Inventory.
c. current period cost less the cost of beginning c. there is no ending Work in Process Inventory.
inventory d. beginning and ending Work in Process Inventories are
d. current period cost plus the cost of ending inventory each 50 percent complete.

8. The weighted average method is thought by some 15. The primary difference between the FIFO and weighted
accountants to be inferior to the FIFO method because it average methods of process costing is
a. is more difficult to apply. a. in the treatment of beginning Work in Process
b. only considers the last units worked on. Inventory.
c. ignores work performed in subsequent periods. b. in the treatment of current period production costs.
d. commingles costs of two periods. c. in the treatment of spoiled units.
d. none of the above.
9. The first step in determining the cost per EUP per cost
component under the weighted average method is to 16. Material is added at the beginning of a process in a process
a. add the beginning Work in Process Inventory cost to costing system. The beginning Work in Process Inventory
the current period's production cost. for the process was 30 percent complete as to conversion
b. divide the current period's production cost by the costs. Using the FIFO method of costing, the number of
equivalent units. equivalent units of material for the process during this
c. subtract the beginning Work in Process Inventory cost period is equal to the
from the current period's production cost. a. beginning inventory this period for the process.
d. divide the current period's production cost into the b. units started and completed this period in the process.
EUP. c. units started this period in the process plus the
beginning Work in Process Inventory.
10. The difference between EUP calculated using FIFO and EUP d. units started and completed this period plus the units
calculated using weighted average is the equivalent units in ending Work in Process Inventory.
a. started and completed during the period.
b. residing in beginning Work in Process Inventory. 17. In a cost of production report using process costing,
c. residing in ending Work in Process Inventory. transferred-in costs are similar to the
d. uncompleted in Work in Process Inventory. a. cost of material added at the beginning of production.
b. conversion cost added during the period.
11. EUP calculations for standard process costing are the same c. cost transferred out to the next department.
as d. cost included in beginning inventory.
a. the EUP calculations for weighted average process
costing. 18. In a process costing system, the journal entry to record the
b. the EUP calculations for FIFO process costing. transfer of goods from Department #2 to Finished Goods
c. LIFO inventory costing for merchandise. Inventory is a
d. the EUP calculations for LIFO process costing. a. debit Work in Process Inventory #2, credit Finished
Goods Inventory.
12. In a FIFO process costing system, which of the following are b. debit Finished Goods Inventory, credit Work in Process
assumed to be completed first in the current period? Inventory #1.
a. units started this period c. debit Finished Goods Inventory, credit Work in Process
b. units started last period Inventory #2.
c. units transferred out d. debit Cost of Goods Sold, credit Work in Process
d. units still in process Inventory #2.

19. Transferred-in cost represents the cost from

a. the last department only.
b. the last production cycle.
c. all prior departments.
d. the current period only.

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20. Process costing techniques should be used in assigning

costs to products
a. if a product is manufactured on the basis of each order
received.
b. when production is only partially completed during
the accounting period.
c. if a product is composed of mass-produced
homogeneous units.
d. whenever standard-costing techniques should not be
used.

Suggested answers
Theory – CCDCD, CBDAB, BBBBA, DACCD

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SOLUTIONS

1. A
Units Transferred Out 6,000

Less: Units in Beginning Inventory (400)

Units Started and Completed 5,600

2. B
Beginning Work in Process 1,000

Add: Units Started 8,600

Deduct: Units Transferred Out (6,400)

Ending Work in Process 3,200

3. C
Beginning Work in Process 5,000

Add: Units Started 54,000

Deduct: Units Transferred Out ( 47,000)

Ending Work in Process 12,000

4. A
Units started this period 32,000

Less: Ending Work in Process 2,500

Units started and completed this period 29,500

5. A
Materials are added at the beginning of the process. 32,000 units were started in the current period; therefore there are 32,000 equivalent units for materials.

6. B
Equivalent Units for Conversion

Beginning Inventory (7,000 * 60%) 4,200

Started and Completed (29,500) 29,500

Ending Inventory (2,500 * 25%) 625

34,325 eq. units

7. D
Equivalent Units--Materials

Beginning Inventory (7,000 units) 7,000

Started this Period (32,000) 32,000

39,000 eq. units

8. B
Equivalent Units--Conversion

Beginning Inventory (7,000 * 100%) 7,000

Started and Completed (29,500) 29,500

Ending Inventory (2,500 * 25%) 625

37,125 eq. units

9. A
Work done EUP, Materials
Beginning 7,000 -
Started and completed 29,500 100% 29,500
Ending 2,500 100% 2,500
Units Accounted for 39,000 32,000

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10. B
Work done EUP, Materials
Beginning 7,000 100% 7,000
Started and completed 29,500 100% 29,500
Ending 2,500 - -
Units Accounted for 39,000 36,500

11. C
Work done EUP, Materials
Beginning 7,000 60% 4,200
Started and completed 29,500 100% 29,500
Ending 2,500 - -
Units Accounted for 39,000 33,700

12. C
Beginning Work in Process 10,000

Units Started 120,000

Total Units 130,000

13. D

BWIP: Materials P24,500

BWIP: Conversion 68,905

Current Period: Materials 75,600

Current Period: Conversion 130,053

Total Costs P299,058

14. A
Units started this period 120,000

Less: Ending Work in Process 8,200

Units started and completed this period 111,800

15. D
Equivalent Units

Beginning Inventory (10,000 * 100%) 10,000

Started and Completed (111,800) 111,800

Ending Inventory (8,200 * 25%) 8,200

130,000 eq. units

16. B
Equivalent Units

Beginning Inventory (Ignored for FIFO) 0

Started and Completed (111,800) 111,800

Ending Inventory (8,200 * 25%) 8,200

120,000 eq. units

17. C
Beginning Work in Process 10,000 45% 4,500

+ Completion of Units in Process 10,000 55% 5,500

+ Units Started and Completed 111,800 100% 111,800

+ Ending Work in Process 8,200 80% 6,560

Equivalent Units of Production 128,360

18. C
Beginning Work in Process (ignored) 10,000 0% -

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+ Completion of Units in Process 10,000 55% 5,500

+ Units Started and Completed 111,800 100% 111,800

+ Ending Work in Process 8,200 80% 6,560

Equivalent Units of Production 123,860

19. C
Material Costs:

Beginning P24,500

Current Period 75,600

100,100 ÷ 130,000 units= P 0.77 per unit

20. C
Conversion Costs:

Beginning P68,905

Current Period 130,053

198,958 ÷ 128,360 units= P 1.55 per unit

21. D
Units Completed Costs per Equivalent Unit Total

121,800 (1.55 + .77) = P2.32 P282,576

22. A
Conversion Costs:

Beginning (Ignored)

Current Period P130,053

P130,053 ÷ 123,860 units= P1.05 per unit

23. C
Beginning Inventory

10,000 units:

Raw Materials (prior period) P24,500

Direct Labor (prior period 68,905

FOH (10,000 * .55 * P1.05) 5,775

P99,180

Units Started and Completed

111,800 units * P (.63+1.05): P187,824

Total P287,004

24. A
Units WD DM WD CC
Transferred out 30,000 100% 30,000 100% 30,000
Ending WIP 5,000 100% 5,000 2/5 2,000
Units accounted for 35,000 35,000 32,000

Cost of beginning WIP

Direct materials 8,145
Conversion cost
(3,315 + 1,050) 4,365
Cost this period
Direct materials 10,860
Conversion cost
(7,309 + 2,534) 9,843
Cost to account for 33,213

Cost per EUP

Materials 0.5430
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Conversion cost 0.4440

Total cost per EUP 0.9870
Transferred out - EUP 30,000
Cost of transferred out to dept. 2 29,610

Ending WIP
Materials (5,000 x 0.5430) 2,715
Conversion cost (2,000 x 0.4440) 888
Cost of ending WIP 3,603
Cost accounted for 33,213

25. D
Beginning WIP 9,000
Transferred In 30,000
Units to account for 39,000

Units WD T/in WD DM WD CC
Transferred out 31,000 100% 31,000 100% 31,000 100% 31,000
Ending WIP 8,000 100% 8,000 100% 8,000 7/8 7,000
Units accounted for 39,000 39,000 39,000 38,000

Cost of beginning WIP

Transferred In 9,000
Direct materials 3,996
Conversion cost
(1,998 + 1,332) 3,330
Cost this period
Transferred In 29,610
Direct materials 30,636
Conversion cost
(23,310 + 15,540) 38,850
Cost to account for 115,422

Cost per EUP

Transferred In 0.9900
Materials 0.8880
Conversion cost 1.1100
Total cost per EUP 2.9880
Transferred out - EUP 31,000
Cost of transferred out to dept. 2 92,628

Ending WIP
Transferred In 7,920
Materials (8,000 x 0.9114) 7,104
Conversion cost (7,000 x 1.1400) 7,770
Cost of ending WIP 22,794
Cost accounted for 115,422

26. A
Materials: FIFO

Beginning Work in Process - 0% -

+ Units Started and Completed 65,000 100% 65,000

+ Ending Work in Process 13,000 100% 13,000

+ Normal Spoilage (discrete) 1,100 100% 1,100

+ Abnormal Spoilage 900 100% 900

Equivalent Units of Production 80,000

27. D
Conversion: FIFO

Units % Complete EUP

Beginning Work in Process 7,500 60% 4,500

+ Units Started and Completed 65,000 100% 65,000

+ Ending Work in Process 13,000 70% 9,100

+ Normal Spoilage (discrete) 1,100 100% 1,100

+ Abnormal Spoilage 900 100% 900

Equivalent Units of Production 80,600

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28. B
Materials: Weighted Average Units % Complete EUP

Beginning Work in Process 7,500 100% 7,500

+ Units Started and Completed 65,000 100% 65,000

+ Ending Work in Process 13,000 100% 13,000

+ Normal Spoilage (discrete) 1,100 100% 1,100

+ Abnormal Spoilage 900 100% 900

Equivalent Units of Production 87,500

29. A
Conversion: FIFO Units % Complete EUP

Beginning Work in Process 7,500 100% 7,500

+ Units Started and Completed 65,000 100% 65,000

+ Ending Work in Process 13,000 70% 9,100

+ Normal Spoilage (discrete) 1,100 100% 1,100

+ Abnormal Spoilage 900 100% 900

Equivalent Units of Production 83,600

30. C
FIFO: Materials

Current Period P 120,000

P 120,000 ÷ 80,000 units= P1.50 per unit

31. C
FIFO: Conversion

Current Period P 350,000

P 350,000 ÷ 80,600 units = P 4.34 per unit

32. A
Weighted Average:

Materials

Beginning P10,400

Current Period 120,000

130,400 ÷ 87,500 units = P1.49 /unit

33. D
Weighted Average:

Conversion

Beginning P13,800

Current Period 350,000

363,800 ÷ 83,600 units = P4.35 per unit

34. B
Ending Inventory: FIFO

Materials 13,000 P 1.50 P19,500

Conversion (13,000 * 70%) 9,100 4.34 39,494

Total P 58,994

35. C
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Abnormal

Spoiled Units 900

Price per Equivalent Unit P5.84

Total P5,256

36. D
Normal

Spoiled Units 1,100

Price per Equivalent Unit P5.84

Total P6,424 Transferred Out

37. B
Goods Transferred Out/ Price per Eq Unit Total

73,600 P5.84 P429,824

38. D

PRIA Concepts Manufacturing

Cost of Production Report

Unit Schedule
Work-in-process, beginning 10,000
Started during December 40,000
Units to be Accounted for 50,000

Completed & Transferred 38,400 Good units (38,400 + 8,000) 46,400

Work-in-process, ending 8,000
Spoiled Units (squeeze) 3,600 Normal Spoilage 5% of good units
Units Accounted for 50,000 Normal Spoilage 2320
Abnormal Spoilage 1,280

Work done this period Materials EUP WD CC EUP

Completed & Transferred 38,400 100% 38,400 100% 38,400
Work-in-process, ending 8,000 100% 8,000 65% 5,200
Normal Spoilage 2320 100% 2,320 50% 1,160
Abnormal Spoilage 1,280 100% 1,280 50% 640
Units Accounted for 50,000 50,000 45,400

Cost Schedule
divide by Cost
Work-in-process, beginning Cost this period TOTAL EUP per EUP
Direct Materials 50,000.00 100,000.00 150,000.00 50,000 3.00
Conversion Costs 30,000.00 140,000.00 170,000.00 45,400 3.74
Total Cost to be Accounted for 320,000.00
Total Cost per EUP 6.74

COST OF ABNORMAL LOSS

Direct Materials (1,280 x 3.00) 3,840.00
Conversion Costs (640 x 3.74) 2,396.48
6,236.48
COST OF NORMAL LOSS
Direct Materials 6,960.00 (2,320 x 3.00)
Conversion Cost 4,343.61 (1,160 x 3.74)
TOTAL 11,303.61

Cost of Completed and Transferred Goods

(38,400 x 6.74) 258,988.55
Adjustment for Normal Loss 9,354.71
268,343.26

Cost of Work-in-process, Ending

Direct Materials (8,000 x 3.00) 24,000.00
Conversion Costs (5,200 x 3.74) 19,471.37
Adjustment for Normal Loss 1,948.90
45,420.26
COST ACCOUNTED FOR 320,000.00

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Allocation of Normal Loss

C&T Ending TOTAL
Good Units 38,400 8,000 46,400
Direct Materials 5,760.00 1,200.00 6,960.00
Conversion Costs 3,594.71 748.90 4,343.61
TOTAL 9,354.71 1,948.90 11,303.61

39. C. 2,320 units

40. A. 1,280 units

41. D. 6.74 per EUP

42. A. P6,236.48 Abnormal Loss

43. C

From current production

Direct materials (8,000 x 3.00) 24,000
Adjustment from Normal Loss 1,200
Total 25,200

Conversion costs (5,200 x 3.74) 19.471

Adjustment from Normal Loss 749
Total 20,220

Total Work-in-process, ending 45,420

44. Answer is (A).

Equivalent Units for

Actual Materials Conversion
C& T: In Process, beg. 1,900 1,900 1,140
Received 6,100 6,100 6,100
IP, end 5,000 3,500
Abnormal lost units
IP, beg 100 50
Received 900 . 810
Totals 14,000 8,000 11,600
C&T IP, beg : Cost last month P 15,200

Cost added this month: M (1,900 x P3.00) 5,760

C (1,140 x P3.90) 4,446

Total cost of completed units from IP, beg. P25,346

45. Answer is (A). Total cost of competed units from received = (6,100 x P13.90) = P 84,790

46. Answer is (D).

Cost last month (100 units x P8) P 800

Conversion (50 units x P3.90) 195

Total cost of units lost from IP, beg P 995

47. Answer is (A).

Cost from preceding dept ( 900 units x P7) P 6,300

Conversion (810 units x P3.90) 3,159

Total cost of units lost from received this month P 9,459

48. Answer is (D).

Cost from preceding department (5,000 x P7) P35,000

Conversion (3,500 x P3.90) 13,650

Total cost of IP, end P48,650

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UNITS ACCOUNTED FOR
PROB#1 PROB#2 PROB#3
Beginning 400 1,000 5,000
Started this period 6,350 8,600 54,000
Units to be accounted for 6,750 9,600 59,000
AVE
Completed and Transferred 6,000 6,400 47,000
Ending WIP 750 3,200 12,000
Units acctd for 6,750 9,600 59,000
FIFO
Beginning 400 1,000 5,000
Started and completed 5,600 5,400 42,000
Ending WIP 750 3,200 12,000
Units acctd for 6,750 9,600 59,000

EUP
Beginning WIP 7,000
Started 32,000
Units to be acctd for 39,000

FIFO work done EUP-Mat work done EUP - CC

Beg 7,000 - - 60% 4,200
S&C 29,500 100% 29,500 100% 29,500
End 2,500 100% 2,500 25% 625
Acctg for 39,000 32,000 34,325

AVE work done EUP-Mat work done EUP - CC

C&T 36,500 100% 36,500 100% 36,500
End 2,500 100% 2,500 25% 625
Acctg for 39,000 39,000 37,125

#9 #10
FIFO work done EUP-Mat work done EUP-Mat
Beg 7,000 - - 100% 7,000
S&C 29,500 100% 29,500 100% 29,500
End 2,500 100% 2,500 0% -
Acctg for 39,000 32,000 36,500

#11
FIFO work done EUP-Mat
Beg 7,000 60% 4,200
S&C 29,500 100% 29,500
End 2,500 0% -
Acctg for 39,000 33,700

COST ACCOUNTED FOR

FIFO AVE
Beginning 10,000 Beginning 10,000 C&T 121,800
Started 120,000 S&C 111,800 Ending 8,200
Units to be 130,000 Ending 8,200 Acctd for 130,000
Acctd for 130,000

Beginning cost Materials 24,500

Conversion 68,905 93,405
Current costs Materials 75,600
Conversion 130,053 205,653
Cost to be accounted for 299,058

AVE WD EUP - Mat WD EUP - CC

C&T 121,800 100% 121,800 100% 121,800
Ending 8,200 100% 8,200 80% 6,560
Acctd for 130,000 130,000 128,360

Cost per EUP Materials Conversion Total

Beginning cost 24,500 68,905
Current cost 75,600 130,053
Total 100,100 198,958
Divide by EUP 130,000 128,360
Cost per EUP 0.7700 1.5500 2.3200

C&T 121,800 x 2.32 282,576

Ending WIPMat (8,200 x 0.77) 6,314
CC (6,560 x 1.55) 10,168
Cost of ending WIP 16,482
Cost accounted for 299,058

FIFO WD EUP - Mat WD EUP - CC

Beginning 10,000 0% - 55% 5,500
S&C 111,800 100% 111,800 100% 111,800
Ending 8,200 100% 8,200 80% 6,560
Acctd for 130,000 120,000 123,860

COST per EUP Materials Conversion Total

Current cost 75,600 130,053
Divide by EUP 120,000 123,860
COST per EUP 0.6300 1.0500 1.6800

Beginning 93,405
CC (5,500 x 1.05) 5,775 99,180
S&C 111,800 x 1.68 187,824
Completed and Transferred 287,004
Ending WIP
Mat (8,200 x .63) 5,166
CC (6,560 x 1.05) 6,888 12,054
Cost accounted for 299,058