Problem 20-6B (Concluded)
4. Assignment of costs to output of department—FIFO
Costs of goods transferred out
Cost of beginning work in process inventory………..
Costs to complete beginning work in process
Cost of units started and completed this period
Direct materials (175,000 EUP x $2.50 per EUP)…… 437,500
Cost of ending work in process inventory
Direct materials (61,000 EUP x $2.50 per EUP)…….. 152,500
Problem 20-7B (80 minutes)
Part 1
BELDA CO.—Cutting Department
Process Cost Summary – FIFO Method
For Month Ended March 31
Costs Charged to Production
Costs of beginning work in process
Direct materials………………………………………………………. $ 16,800
Unit cost information
Units to account for Units accounted for
Beginning work in process………….10,000 Completed & transferred out……. 220,000
0
Equivalent units of production
Direct
Materials Conversion
Units to complete beginning WIP
Direct materials (10,000 x 25%)…….. 2,500 EUP
[Continued on next page]
Problem 20-7B (Continued)
Cost per EUP
Direct
Materials Conversion
Costs incurred this period……………… $ 223,200 $1,233,960
EUP
EUP
Cost assignment and reconciliation
Costs transferred out
Cost of beginning work in process………………………………… $ 114,520
Cost to complete beginning work in process
Direct materials (2,500 EUP x $0.96 per EUP)…………………$ 2,400
Part 2
Mar. 31 Work in Process Inventory—Blending……………………1,486,960
Problem 20-7B (Concluded)
If equivalent units of production for the production department’s ending
inventory for March are overstated, then total equivalent units of
production is also overstated. This means the cost per equivalent unit for
March is understated and the production manager would be paid a larger
SERIAL PROBLEM — SP 20
1. Features of job order and process costing follow.
Job order costing Process costing
Custom orders Repetitive operations
2. Given the size of her company, and the types of products she sells,
Santana should probably stay with job order costing. The furniture
COMPREHENSIVE PROBLEM
Comprehensive Problem, Major League Bat Company (110 minutes)
[Instructor note: General Ledger accounts are shown in Part 4.]
Part 1 (Using either weighted-average or FIFO)
July Journal Entries
a. Raw Materials Inventory ……………………………………….125,000
Cash………………………………………………………………. 125,000
Purchased raw materials for cash.
b. Work in Process Inventory…………………………………….52,440
c. Work in Process Inventory…………………………………….202,250
d. Factory Payroll Payable ……………………………………….227,250
e. Factory Overhead ………………………………………………..80,000
f. Work in Process Inventory…………………………………….101,125
Comprehensive Problem (Continued)
Part 2 (Using weighted-average)
MAJOR LEAGUE BAT CO.
Process Cost Summary (Weighted Average)
For Month Ended July 31
Costs Charged to Production
Costs of beginning work in process
Direct materials………………………………………………………. $ 2,660
Unit cost information
Units to account for Units accounted for
Beginning work in process………………………………5,000 Complete & transferred out…………11,000
Equivalent units of production
Direct
Materials Conversion
Units completed & transferred out………..11,000 EUP 11,000 EUP
Units of ending work in process
Cost per EUP
Direct
Materials Conversion
Cost of beginning work in process………. $ 2,660 $ 5,475