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Costs before adding normal spoilage
Normal spoilage (2,460 units)
(A) Total costs of good units completed and
transferred out
(B) Abnormal spoilage (1,500 units)
(C) Work in process, ending (5,040 units)
(A)+(B)+(C) Total costs accounted for
$82,656
8,266
90,922
5,040
11,466
$107,428
(24,600# 1.81) +
(2,460# 1.81) +
(1,500# 1.81) +
(5,040# 1.81) +
$60,816 +
(24,600# 1.55)
(2,460# 1.55)
(1,500# 1.55)
(1,512# 1.55)
$46,612
#Equivalent units of direct materials and conversion costs calculated in Step 2 in Panel A above.
Work in process, ending‡ (given)
8,400 100%; 8,400 0%; 8,400 40%
Accounted for
Equivalent units of work done to date
8,400
37,200
8,400
37,200
0
______
28,800
3,360
_____
32,160
*Normal spoilage is 8% of good units transferred out: 8% 26,400 = 2,112 units. Degree of completion of normal spoilage in
this department: transferred-in costs, 100%; direct materials, 100%; conversion costs, 100%.
†Total spoilage =12,600 + 24,600 – 26,400 – 8,400 = 2,400 units. Abnormal spoilage = 2,400 – 2,112 = 288 units. Degree of
completion of abnormal spoilage in this department: transferred-in costs, 100%; direct materials, 100%; conversion costs,
100%.
‡Degree of completion in this department: transferred-in costs, 100%; direct materials, 0%; conversion costs, 40%.
PANEL B: Summarize the Total Costs to Account for, Compute the Cost per Equivalent Unit, and
Assign Costs to the Units Completed, Spoiled Units, and Units in Ending Work-in-Process
Inventory
Total
Production
Costs
Transferred-in
Costs
Direct
Materials
Conversion
Costs
(Step 3) Work in process, beginning (given)
Costs added in current period (given)
Total costs to account for
(Step 4) Costs incurred to date
Divided by equivalent units of work done to date
Cost per equivalent unit
(Step 5) Assignment of costs
Good units completed and transferred out
(26,400 units)
$ 51,338
143,362
$194,700
$ 33,698
90,922*
$124,620
124,620
37,200
$ 3.35
$ 0
5,760
$5,760
5,760
28,800
$ 0.20
$23,475
40,845
$64,320
64,320
32,160
$ 2.00
Costs before adding normal spoilage
Normal spoilage (2,112 units)
(A) Total cost of good units completed and
transferred out
(B) Abnormal spoilage (288 units)
(C) Work in process, ending (8,400 units)
(A)+(B)+(C) Total costs accounted for
$146,520
11,722
158,242
1,598
34,860
$194,700
26,400# ($3.35 + $0.20 + $2)
2,112# ($3.35 + $0.20 + $2)
288# ($3.35 + $0.20 + $2)
(8,400# $3.35) + (0# $0.20) + (3,360# $2)
$124,620 + $5,760 + $64,320
*Total costs of good units completed and transferred out in Panel B (Step 5) of Solution Exhibit 18-31.
#Equivalent units of direct materials and conversion costs calculated in Step 2 in Panel A above.
18-34 (25 min.) FIFO method, Packaging Department (continuation of 18-32).
Refer to the information in Problem 18-33 except that the transferred-in costs of beginning work
in process on May 1 are $33,090 (instead of $33,698). Transferred-in costs for May equal the total
cost of good units completed and transferred out in May from the cleaning department, as
calculated in Problem 18-32 using the FIFO method of process costing.
Required:
