17-11
17-24 (25 min.) Weighted-average method, assigning costs.
1. & 2.
Solution Exhibit 17-24A shows equivalent units of work done to date for Bio Doc Corporation
for direct materials and conversion costs.
Solution Exhibit 17-24B summarizes total costs to account for, calculates the cost per equivalent
unit of work done to date for direct materials and conversion costs, and assigns these costs to
units completed and transferred out and to units in ending work–in–process inventory.
17-12
SOLUTION EXHIBIT 17-24B
Steps 3, 4, and 5: Summarize Total Costs to Account For, Compute Cost per Equivalent Unit,
and Assign Total Costs to Units Completed and to Units in Ending Work in Process;
Weighted-Average Method of Process Costing, Bio Doc Corporation for July 2011.
Total
Production
Costs
Conversion
Costs
(Step 3) Work in process, beginning (given)
$108,610
$ 45,510
Costs added in current period (given)
769,940
485,040
Total costs to account for
$878,550
$530,550
(Step 4) Costs incurred to date
$530,550
Divide by equivalent units of work done to
date (Solution Exhibit 17-24A)
39,300
Cost per equivalent unit of work done to date
$ 13.50
(Step 5) Assignment of costs:
Completed and transferred out (33,000 units)
$709,500
(33,000* $8.00) + (33,000* $13.50)
Work in process, ending (10,500 units)
169,050
(10,500† $8.00) + (6,300† $13.50)
Total costs accounted for
$878,550
$348,000 + $530,550
*Equivalent units completed and transferred out (given).
†Equivalent units in ending work in process (given).
17-13
17-25 (30 min.) FIFO method, assigning costs.
1. & 2. Solution Exhibit 17-25A calculates the equivalent units of work done in the current
period. Solution Exhibit 17-25B summarizes total costs to account for, calculates the cost per
equivalent unit of work done in the current period for direct materials and conversion costs, and
assigns these costs to units completed and transferred out and to units in ending work–in–process
inventory.
17-14
SOLUTION EXHIBIT 17-25B
Steps 3, 4, and 5: Summarize Total Costs to Account For, Compute Cost per Equivalent Unit, and Assign Total Costs to Units
Completed and to Units in Ending Work in Process;
FIFO Method of Process Costing, Bio Doc Corporation for July 2011.
Total
Production
Costs
Direct
Materials
Conversion
Costs
(Step 3) Work in process, beginning (given)
$108,610
$ 63,100
$ 45,510
Costs added in current period (given)
769,940
284,900
485,040
Total costs to account for
$878,550
$348,000
$530,550
(Step 4) Costs added in current period
$284,900
$485,040
Divide by equivalent units of work done in
current period (Solution Exhibit 17-25A)
35,000
37,600
Cost per equivalent unit of work done in current period
$ 8.14
$ 12.90
(Step 5) Assignment of costs:
Completed and transferred out (33,000 units):
Work in process, beginning (8,500 units)
Cost added to beginning work in process in current period
$108,610
87,720
$63,100 + $45,510
(0* $8.14) + (6,800* $12.90)
Total from beginning inventory
Started and completed (24,500 units)
Total costs of units completed and transferred out
Work in process, ending (10,500 units)
196,330
515,480
711,810
166,740
(24,500† $8.14) + (24,500† $12.90)
(10,500# $8.14) + (6,300# $12.90)
Total costs accounted for
$878,550
$348,000
+ $530,550
*Equivalent units used to complete beginning work in process from Solution Exhibit 17-25A, Step 2.
†Equivalent units started and completed from Solution Exhibit 17-25A, Step 2.
#Equivalent units in ending work in process from Solution Exhibit 17-25A, Step 2.
17-15
17-26 (30 min.) Standard-costing method, assigning costs.
1. The calculations of equivalent units for direct materials and conversion costs are identical
to the calculations of equivalent units under the FIFO method. Solution Exhibit 17-25A shows
2. Solution Exhibit 17-26 shows the direct materials and conversion costs variances for
Direct materials $3,850 F
Conversion costs $7,520 U
SOLUTION EXHIBIT 17-26
Steps 3, 4, and 5: Summarize Total Costs to Account For, Compute Cost per Equivalent Unit,
17-16
17-27 (35–40 min.) Transferred-in costs, weighted-average method.
1, 2. & 3. Solution Exhibit 17-27A calculates the equivalent units of work done to date.
Solution Exhibit 17-27B summarizes total costs to account for, calculates the cost per equivalent
unit of work done to date for transferred-in costs, direct materials, and conversion costs, and
assigns these costs to units completed and transferred out and to units in ending work–in–process
inventory.
SOLUTION EXHIBIT 17-27B
Steps 3, 4, and 5: Summarize Total Costs to Account For, Compute Cost per Equivalent Unit, and Assign Total Costs to Units
Completed and to Units in Ending Work in Process;
Weighted-Average Method of Process Costing,
17-18
17-28 (35–40 min.) Transferred-in costs, FIFO method.
Solution Exhibit 17-28A calculates the equivalent units of work done in the current period (for
transferred-in costs, direct-materials, and conversion costs) to complete beginning work–in–
process inventory, to start and complete new units, and to produce ending work in process.
Solution Exhibit 17-28B summarizes total costs to account for, calculates the cost per equivalent
(Step 1)
(Step 2)
Equivalent Units
Flow of Production
Physical
Units
Transferred-in
Costs
Direct
Materials
Conversion
Costs
Work in process, beginning (given)
75
(work done before current period)
Transferred-in during current period (given)
135
To account for
210
Completed and transferred out during current period:
From beginning work in processa
75
[75
(100% – 100%); 75
(100% – 0%); 75
(100% – 60%)]
0
75
30
Started and completed
75b
(75
100%; 75
100%; 75
100%)
75
75
75
Work in process, endingc (given)
60
(60
100%; 60
0%; 60
75%)
___
60
0
45
Accounted for
210
___
___
___
Equivalent units of work done in current period
135
150
150
aDegree of completion in this department: Transferred-in costs, 100%; direct materials, 0%; conversion costs, 60%.
b150 physical units completed and transferred out minus 75 physical units completed and transferred out from beginning
work–in-process inventory.
cDegree of completion in this department: transferred-in costs, 100%; direct materials, 0%; conversion costs, 75%.
17-19
SOLUTION EXHIBIT 17-28B
Steps 3, 4, and 5: Summarize Total Costs to Account For, Compute Cost per Equivalent Unit, and Assign Total Costs to Units
Completed and to Units in Ending Work in Process;
FIFO Method of Process Costing,
Finishing Department of Asaya Clothing for June 2012.
Total
Production
Costs
Transferred-in
Costs
Direct Materials
Conversion Costs
(Step 3)
Work in process, beginning (given)
$ 90,000
$ 60,000
$ 0
$ 30,000
Costs added in current period (given)
246,300
130,800
37,500
78,000
Total costs to account for
$336,300
$190,800
$37,500
$108,000
(Step 4)
Costs added in current period
$130,800
$37,500
$ 78,000
Divide by equivalent units of work done in current period
(Solution Exhibit 17-28A)
÷ 135
÷ 150
÷ 150
Cost per equivalent unit of work done in current period
$ 968.89
$ 250
$ 520
(Step 5)
Assignment of costs:
Completed and transferred out (150 units)
Work in process, beginning (75 units)
$ 90,000
$ 60,000
$ 0
$ 30,000
Costs added to beginning work in process in current period
34,350
(0a $968.89)
+ (75a $250)
+ (30 a $520)
Total from beginning inventory
124,350
Started and completed (75 units)
130,416
(75b $968.89)
+ (75b $250)
+ (75b $520)
Total costs of units completed and transferred out
254,766
Work in process, ending (60 units):
81,534
(60c $968.89)
+ (0c $250)
+ (45c $520)
Total costs accounted for
$336,300
$190,800
+ $37,500
+ $108,000
a Equivalent units used to complete beginning work in process from Solution Exhibit 17-28A, step 2.
b Equivalent units started and completed from Solution Exhibit 17-28A, step 2.
c Equivalent units in ending work in process from Solution Exhibit 17-28A, step 2.
1. Calculate the conversion cost rates for each department:
Vitamin A
Vitamin B
Multi-vitamin
Total
Budgeted 200-unit bottles
12,000
9,000
18,000
39,000
Budgeted labor hours
300a
225
450
975
Budgeted machine hours
200b
150
300
650
Direct Materials
Total
Total budgeted costs
12,000