CHAPTER 3
SOLUTIONS TO EXERCISES—SET B
EXERCISE 3-1B
(a) April 30 Work in Process—Cooking …………………. 27,000
Work in Process—Canning …………………. 10,000
Raw Materials Inventory……………….. 37,000
30 Work in Process—Cooking …………………. 9,000
EXERCISE 3-2B
(a) Work in process, May 1 500
Started into production 1,350
Total units to be accounted for 1,850
Less: Transferred out 1,350
Work in process, May 31 500
(b)
Equivalent Units
Materials
Conversion Costs
EXERCISE 3-2B (Continued)
(c) $7,905 ÷ 1,550 = $5.10
(d) Transferred out (1,350 X $11.22) $15,147
EXERCISE 3-3B
1. Raw Materials Inventory …………………………………… 64,300
Accounts Payable …………………………………….. 64,300
2. Factory Labor ………………………………………………….. 48,500
4. Work in Process—Cutting ………………………………… 16,400
Work in Process—Assembly ……………………………. 9,900
Raw Materials Inventory ……………………………. 26,300
7. Work in Process—Assembly ……………………………. 68,300
Work in Process—Cutting …………………………. 68,300
8. Finished Goods Inventory ………………………………… 136,000
Work in Process—Assembly ……………………… 136,000
(a)
January
May
Units to be accounted for
Beginning work in process
Started into production
0
12,000
0
21,000
(b)
(1)
Materials
(2)
Conversion Costs
11,500 (10,000 + 1,500)
January
12,000 ( 9,000 + 3,000)
10,800 ( 9,000 + 1,800)
EXERCISE 3-5B
(a)
Materials
Conversion Costs
Units transferred out
12,000
12,000
Total units
EXERCISE 3-6B
JOSE FURNITURE COMPANY
Sanding Department
Production Cost Report
For the Month Ended March 31, 2017
Equivalent Units
Quantities
Physical
Units
Materials
Conversion
Costs
Units to be accounted for
Work in process, March 1
Started into production
Total units
Units accounted for
0
15,000
15,000
Costs
Materials
Conversion
Costs
Total
Work in process, March 1
Started into production
Total costs
Unit costs
Cost Reconciliation Schedule
Total costs
Costs accounted for
Transferred out (11,000 X $10.35)
Work in process, March 31
$113,850
Transferred out
Work in process, March 31
(4,000 X 30%)
Total units
EXERCISE 3-7B
(a)
Materials
Conversion
Costs
Units transferred out
Work in process, April 30
18,000
18,000
(b)
Materials
Conversion
Costs
Total
Costs in April
$808,000(1)
$385,700(2)
$1,193,700
(c)
Transferred out (18,000 X $60.70)
Work in process
$1,092,600
EXERCISE 3-8B
(a) Materials: 32,000 + 8,000 = 40,000
2,000 X 100%
EXERCISE 3-9B
(a) Materials: 55,000(1) + 30,000 = 85,000
(b) Materials: $136,000/85,000 = $1.60
(c) Units transferred out: 55,000 X $5.77 = $317,350
Units in ending work in process:
EXERCISE 3-10B
(a)
Physical
Units
Work in process, September 30
Work in process, September 1
Units started into production
2,800
12,000
Equivalent Units
Materials
Conversion Costs
Units transferred out
11,800
11,800
EXERCISE 3-10B (Continued)
(b)
Materials
Work in process, September 1
Direct materials
Costs added to production
$ 32,000
Conversion Costs
during September
Work in process, September 1
Conversion costs
$ 29,100
(c) Costs accounted for
Transferred out (11,800 X $43.05) ……………. $507,990
Work in process, September 30
Total materials cost
EXERCISE 3-11B
HANSON MANUFACTURING COMPANY
Welding Department
Production Cost Report
For the Month Ended February 28, 2017
Equivalent Units
Quantities
Physical
Units
Materials
Conversion
Costs
(Step 1)
(Step 2)
Units to be accounted for
Work in process, February 1
Started into production
Total units
Units accounted for
27,000
60,000
87,000
Costs
Materials
Conversion
Costs
Total
Costs to be accounted for
Work in process, February 1
Started into production
Total costs
$ 40,175
254,773
$294,948
Cost Reconciliation Schedule (Step 4)
Conversion costs (6,600 X $1.68)
Total costs
$294,948
Costs accounted for
Transferred out (54,000 X $3.90)
$210,600
Transferred out
Work in process, February 28
Total units
EXERCISE 3-12B
(a)
Containers in transit, April 1
0
Containers loaded
800
Equivalent Units
(b)
Physical
Units
Direct
Materials
Conversion
Costs
Containers off-loaded
350
350
350
Containers in transit, April 30
450
180*
135**
Total equivalent units
EXERCISE 3-13B
(a)
Materials
Conversion
Costs
Applications transferred out
800
800
Work in process, September 30
300*
180**
Equivalent units
1,100
980
(b)
Materials: $6,270 ÷ 1,100 = $5.70
Conversion costs: $22,540* ÷ 980 = $23
Costs accounted for:
Transferred out (800 X $28.70) …………………..
$22,960
Work in process, September 30
Materials (300 X $5.70) ………………………..
Conversion costs (180 X $23) ………………
Total costs ……………………………………………….
Total containers
Containers off-loaded
350
Containers in transit, April 30
Total containers
800
*EXERCISE 3-14B
Equivalent Units
(a)
Physical
Units
Materials
Conversion
Costs
Applications completed:
Work in process, September 1
100
0
50
(b)
Materials: $5,270 ÷ 1,000 = $5.27
Conversion costs: $18,540* ÷ 930 = $19.94
*($12,000 + $6,540)
Costs accounted for:
Applications completed:
5,170
Total costs …………………………………………..
$6,540 = $28,810
Started and completed
700
Work in process, September 30
300
Total units
1,100
1,000
*EXERCISE 3-15B
(a) (1) Materials:
Production Data
Physical
Units
Materials Added
This Period
Equivalent
Units
Work in process, August 1
Started and completed
0
8,000
%100
100%
0
8,000
(2) Conversion Costs:
Production Data
Physical
Units
%
Equivalent
Units
Work in process, August 31
Total
Work in process, August 1
Started and completed
0
8,000
0
100
0
8,000
(b) Unit costs are:
Materials $45,000 ÷ 10,000 = $4.50
Work in process, August 31
Total
*EXERCISE 3-16B
(a)
(1)
Materials
Physical
Units
Materials Added
This Period
Equivalent
Units
Work in process,
Q
(2)
Conversion Costs
Physical
Units
Work Added
This Period
Equivalent
Units
Work in process,
September 1
Started and completed
1,000
8,000
80%
100%
800
8,000
(b) Materials $ 63,000 ÷ 9,000 = $ 7.00
Conversion costs $139,840 ÷ 9,200 = 15.20
$22.20
(c)
Costs to Be
Assigned
Assignment of Costs
Equivalent
Units
Unit
Cost
Total Costs
Assigned
Total mfg. costs
Transferred out
Started and completed
Total costs transferred out
Total costs
Work in process, 9/1
Conversion costs
0
800
$ 0
$15.20
$16,000
12,160
$ 28,160
September 1
Total
1,000
*EXERCISE 3-17B
(a) Work in process, March 1 800
Started into production 1,200
Total units to be accounted for 2,000
(b) Materials:
Production Data
Physical
Units
Materials Added
This Period
Equivalent
Units
Work in process, March 31
Total
1,200
Work in process, March 1
Started and completed
800
500
%100
100%
0
500
(c) Conversion costs:
Production Data
Physical
Units
Work Added
This Period
Equivalent
Units
Work in process, March 31
Total
1,340
Work in process, March 1
Started and completed
800
500
70%
100%
560
500
(d) In process, March 1 …………………………………………………. $3,000
Conversion costs (560 X $2.40) ………………………………… 1,344
(f) Materials (700 X $6.00) …………………………………………….. $4,200
*EXERCISE 3-18B
HOLSUM MANUFACTURING COMPANY
Welding Department
Production Cost Report
For the Month Ended February 28, 2017
Equivalent Units
Quantities
Physical
Units
Materials
Conversion
Costs
(Step 1)
(Step 2)
Units to be accounted for
Work in process, February 1
Started into production
Total units
Units accounted for
Completed and transferred out
12,000
78,000
90,000
Work in process, February 1
Started and completed
12,000
53,000*
0
53,000
10,800
53,000
(12,000 X 90%)
Costs
Materials
Conversion
Costs
Total
Costs to be accounted for
Work in process, February 1
Started into production
Total costs
$ 21,000
289,480
Unit costs (Step 3)
Costs in February
(a)
$179,400
(1)
$110,080
(2)
$289,480
Total
Work in process, February 28
Total units
*EXERCISE 3-18B (Continued)
Cost Reconciliation Schedule
Costs accounted for (Step 4)
Transferred out
Work in process, February 1
Costs to complete beginning
work in process
$21,000
SOLUTIONS TO PROBLEMS—SET C
PROBLEM 3-1C
(a)
Physical units
Units to be accounted for
Work in process, January 1
Started into production
0
50,000
(b)
Equivalent units
Materials
Conversion Costs
Total equivalent units
Units transferred out
40,000
40,000
(c)
Unit Costs
Materials
$11.10 ($555,000 ÷ 50,000)
(d) Costs accounted for
Transferred out (40,000 X $16.35) …………….. $654,000
Work in process, January 31
Total units
PROBLEM 3-1C (Continued)
(e) COMPLETE CORPORATION
Molding Department
Production Cost Report
For the Month Ended January 31, 2017
Equivalent Units
Quantities
Physical
Units
Materials
Conversion
Costs
(Step 1)
(Step 2)
Units to be accounted for
Work in process, January 1
Started into production
Total units
0
50,000
50,000
Costs
Materials
Conversion
Costs
Total
Total costs
Unit costs (Step 3)
Costs in January
(a)
$555,000
$231,000
$786,000
Cost Reconciliation Schedule (Step 4)
Conversion costs (4,000 X $5.25)
Total costs
132,000
Costs accounted for
Transferred out (40,000 X $16.35)
$654,000
Transferred out
Work in process, January 31
Total units
PROBLEM 3-2C
(a) (1) Physical units
R12
Refrigerators
F24
Freezers
Units to be accounted for
Work in process, June 1
Started into production
Total units
0
22,000
22,000
0
20,000
20,000
(2) Equivalent units
R12 Refrigerators
Materials
Conversion
Costs
Units transferred out
Work in process, June 30
14,000
14,000
F24 Freezers
Materials
Conversion
Costs
Units transferred out
Work in process, June 30
18,000
18,000
PROBLEM 3-2C (Continued)
(3) Unit costs
R12
Refrigerators
F24
Freezers
Materials ($836,000 ÷ 22,000)
($720,000 ÷ 20,000)
$38
$36
(4) R12 Refrigerators
Costs accounted for
Transferred out (14,000 X $72) ………….. $1,008,000
Work in process
F24 Freezers
Costs accounted for
Transferred out (18,000 X $63) ………….. $1,134,000
Work in process
PROBLEM 3-2C (Continued)
(b) SUNNYLAND CORPORATION
Stamping Department—Plant A
Production Cost Report
For the Month Ended June 30, 2017
Equivalent Units
Quantities
Physical
Units
Materials
Conversion
Costs
(Step 1)
(Step 2)
Units to be accounted for
Work in process, June 1
Started into production
Total units
0
22,000
22,000
Costs
Materials
Conversion
Costs
Total
Work in process, June 1
Total costs
Unit costs (Step 3)
Costs in June
Equivalent units
(a)
(b)
$836,000
22,000
$693,600
20,400
$1,529,600
Cost Reconciliation Schedule (Step 4)
Conversion costs (6,400 X $34)
Total costs
Costs accounted for
Transferred out (14,000 X $72)
$1,008,000
Transferred out
Work in process, June 30
Total units
PROBLEM 3-3C
1. Raw Materials Inventory …………………………………….. 28,000
Accounts Payable ……………………………………….. 28,000
2. Work in Process—Blending ……………………………….. 18,390
Work in Process—Packaging ……………………………… 9,410
Raw Materials Inventory ………………………………. 27,800
5. Manufacturing Overhead ……………………………………. 41,500
Accounts Payable ……………………………………….. 41,500
6. Work in Process—Blending (1,800 X $20) ……………. 36,000
Work in Process—Packaging (600 X $20) ……………. 12,000
Manufacturing Overhead……………………………… 48,000
PROBLEM 3-4C
(a)
Equivalent Units
Physical
Units
Materials
Conversion
Costs
Units to be accounted for
Work in process, October 1
Started into production
30,000
375,000
(b)
Total costs
Costs accounted for
Transferred out (365,000 X $3.80)
Work in process, October 31
$1,387,000
Total units
40,000
PROBLEM 3-4C (Continued)
(c) SIENNA COMPANY
Assembly Department
Production Cost Report
For the Month Ended October 31, 2017
Equivalent Units
Quantities
Physical
Units
Materials
Conversion
Costs
(Step 1)
(Step 2)
Units to be accounted for
Work in process, October 1
Started into production
Total units
30,000
375,000
405,000
Costs
Materials
Conversion
Costs
Total
Total costs
Unit costs (Step 3)
Costs in October
Equivalent units
(a)
(b)
$1,093,500
405,000
$419,100
381,000
$1,512,600
Cost Reconciliation Schedule (Step 4)
Conversion costs (16,000 X $1.10)
Total costs
Costs accounted for
Transferred out (365,000 X $3.80)
Work in process, October 31
$1,387,000
Transferred out
Work in process, October 31
40,000
40,000
Total units
PROBLEM 3-5C
(a)
(1)
Equivalent Units
Physical
Units
Materials
Conversion
Costs
Units to be accounted for
Work in process, May 1
Started into production
2,000
2,500
(2)
Materials cost
Conversion costs
Beginning work in
process
Added during month
$18,000
90,000
Beginning work in
process
Added during month
$22,000
110,300
($46,000 + $64,300)
(3)
Costs accounted for
Transferred out (2,700 X $66)
Work in process, May 31
$178,200
PROBLEM 3-5C (Continued)
(b) MAUEVE COMPANY
Bicycle Department
Production Cost Report
For the Month Ended May 31, 2017
Equivalent Units
Quantities
Physical
Units
Materials
Conversion
Costs
(Step 1)
(Step 2)
Units to be accounted for
Work in process, May 1
Started into production
Total units
2,000
2,500
4,500
Costs
Materials
Conversion
Costs
Total
Total costs
Unit costs (Step 3)
Costs in May
Equivalent units
Unit costs (a) ÷ (b)
(a)
(b)
$108,000
4,500
$24
$132,300
3,150
$42
$240,300
$66
Cost Reconciliation Schedule (Step 4)
Conversion costs (450 X $42)
Total costs
Costs accounted for
Transferred out (2,700 X $66)
Work in process, May 31
178,200
Transferred out
2,700
Work in process, May 31
Total units
4,500
4,500
PROBLEM 3-6C
(a) Computation of equivalent units:
Equivalent Units
Physical
Units
Materials
Conversion
Costs
Units accounted for
Transferred out
Work in process, March 31
100,000
100,000
100,000
Computation of March unit costs
Materials: $212,800 ÷ 112,000 equivalent units = $1.90
(b) Cost Reconciliation Schedule
Costs accounted for
Transferred out (100,000 X $2.95) ……………. $295,000
Work in process, March 31
*PROBLEM 3-7C
(a) Standard Bicycles
(1) Equivalent units—Materials
Physical
Units
Materials
Added
This Period
Equivalent
Units
Work in process, May 1
Started and completed
400
1,100
(1,600 – 500)
* 0%*
100%
0
1,100
(2) Unit costs
Materials
Conversion
Costs in May (a)
Equivalent units (b)
$57,600
1,600
**$73,980**
1,370
Work in process, May 31
Total
Units
Conversion
This Period
Units
Work in process, May 1
400
Started and completed
Total
(1,600 – 500)
100%
*PROBLEM 3-7C (Continued)
(3) Assignment of costs to units transferred out and in process
Costs to Be
Assigned
Assignment of Costs
Equivalent
Units
Unit
Cost
Total Costs
Assigned
Total mfg. costs
Transferred out
***$148,980***
Work in process, May 1
Conversion
120
$ 54
$17,400
6,480
Premium Bicycles
(1) Equivalent units—Materials
Physical
Units
Materials
Added
This Period
Equivalent
Units
Work in process, May 1
100
* 0%*
0
Started and completed
Work in process, May 31
Total
1,000
900
Equivalent units—Conversion
Physical
Units
Conversion
Added
This Period
Equivalent
Units
Work in process, May 1
100
25% (1 – .75) 25
Started and completed
700 (900 – 200)
100%
700
Work in process, May 31
Total
1,000
Total costs transferred out
Work in process, May 31
Total costs
*PROBLEM 3-7C (Continued)
(2) Unit costs
Materials
Conversion
Costs in May (a)
Equivalent units (b)
$63,000
900
**$76,475**
805
(3) Assignment of costs to units transferred out and in process
Costs to Be
Assigned
Assignment of Costs
Equivalent
Units
Unit
Cost
Total Costs
Assigned
Total mfg. costs
Transferred out
***$147,475***
Work in process, May 1
Conversion
Started and completed
Total costs transferred out
25
700
$ 95
$165
$ 8,000
2,375
115,500
$125,875
Total costs
$147,475
Unit costs (a) ÷ (b)
$70
*PROBLEM 3-7C (Continued)
(b) BRACK COMPANY
Production Cost Report—Standard Bicycles
For the Month Ended May 31
Equivalent Units
Quantities
Physical
Units
Materials
Conversion
Costs
(Step 1)
(Step 2)
Units to be accounted for
Work in process, May 1
Started into production
Total units
400
1,600
2,000
Costs
Materials
Conversion
Costs
Unit costs (Step 3)
Costs in March (a)
Equivalent units (b)
Cost Reconciliation Schedule (Step 4)
Costs accounted for
Transferred out
Work in process, May 1
Conversion costs (120 X $54)
Started and completed (1,100 X $90)
$57,600
1,600
$17,400
6,480
99,000
$ 73,980
1,370
Work In process, May 31
Total units