College of Business Education

Cost Accounting & Control II

S.Y. 2021 – 2022
LECTURE #15 - ANSWER KEY

EXERCISE 3. COST OF PRODUCTION REPORT (UNEVEN APPLICATION OF COSTS)

1. QUANTITY SCHEDULE

STAY-SAFE-AT-HOME MANUFACTURING CORP.

Quantity Schedule
December 2020

DEPARTMENT I DEPARTMENT II DEPARTMENT III

Input: Input: Input:
IP Beg 90,000 Even Uneven IP Beg 80,000 Even Uneven IP Beg 80,000 Even Uneven
PIP 450,000 Application Application Received 460,000 Application Application Received 420,000 Application Application
TUTBAF 540,000 Conversion Costs Materials TUTBAF 540,000 Conversion Costs Materials TUTBAF 500,000 Conversion Costs Materials
Output: Actual % EUP % EUP Output: Actual % EUP % EUP Output: Actual % EUP % EUP
TO 460,000 IP Beg, F & T 90,000 2/3 60,000 0% - TO 420,000 IP Beg, F & T 80,000 40% 32,000 0% 0 TO 400,000 IP Beg, F & T 80,000 60% 48,000 100% 80,000
PIP, F & T 370,000 100% 370,000 100% 370,000 Received, F&T 340,000 100% 340,000 100% 340,000 Received, F&T 320,000 100% 320,000 100% 320,000
IP, End 60,000 IP, End 60,000 2/3 40,000 100% 60,000 IP, End 100,000 IP, End 100,000 75% 75,000 100% 100,000 IP, End 80,000 IP, End 80,000 40% 32,000 0% 0
Normal Loss 20,000 Normal Loss 20,000 20% 4,000 100% 20,000 Normal Loss 20,000 Normal Loss 20,000 0% 0 0% 0 Normal Loss 20,000 Normal Loss 20,000 0% 0 0% 0
TUAF 540,000 Total 540,000 474,000 450,000 TUAF 540,000 Total 540,000 447,000 440,000 TUAF 500,000 Total 500,000 400,000 400,000

2. REMAINING UNITS 2. REMAINING UNITS 2. REMAINING UNITS

Remaining Units = units that passed thru POL IP Beg, F & T No Remaining Units = Received - Lost Units IP Beg, F & T No Remaining Units = EUP of Conversion Costs IP Beg, F & T Yes
= 370,000 + 60,000 PIP, F & T Yes = 460,000 - 20,000 Received, F&T Yes = 48k + 320k + 32k Received, F&T Yes
= 430,000 IP, End Yes = 440,000 IP, End Yes = 400,000 IP, End Yes

3. LOSS ADJUSTMENT 3. LOSS ADJUSTMENT 3. LOSS ADJUSTMENT

Loss Adjustment: Loss Adjustment: Loss Adjustment:

Normal Loss: 20,000 units Normal Loss: 20,000 units Normal Loss: 20,000 units
M (20k x 3) 60,000 M - M -
L (4k x 2) 8,000 L - L -
FOH (4k x 0.2) 800 FOH - FOH -
Cost of Normal Loss 68,800 Trans In Cost (20k x 5.50) 110,000 Trans In Cost (20k x 10) 200,000
Divided by: Remaining Units 430,000 Cost of Normal Loss 110,000 Cost of Normal Loss 200,000
Loss Adjustment 0.16 Divided by: Remaining Units 440,000 Divided by: Remaining Units 400,000
Loss Adjustment 0.25 Loss Adjustment 0.50
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 4. COST OF PRODUCTION REPORT

STAY-SAFE-AT-HOME MANUFACTURING CORP.

Cost of Production Report
December 2020

DEPARTMENT I DEPARTMENT II DEPARTMENT III

COSTS TO BE ACCOUNTED FOR: Costs EUP Unit Cost COSTS TO BE ACCOUNTED FOR: Costs EUP Unit Cost COSTS TO BE ACCOUNTED FOR: Costs EUP Unit Cost
Costs added this month: Costs added this month: Costs added this month:
M 1,350,000.00 450,000 3.00 M 880,000.00 440,000 2.00 M 400,000.00 400,000 1.00
L 948,000.00 474,000 2.00 L 670,500.00 447,000 1.50 L 320,000.00 400,000 0.80
FOH 94,800.00 474,000 0.20 FOH 447,000.00 447,000 1.00 FOH 280,000.00 400,000 0.70
Total 2,392,800.00 5.20 Total 1,997,500.00 4.50 Total 1,000,000.00 2.50
Cost, Beg 414,800.00 Cost, Beg 635,000.00 Cost, Beg 464,000.00
Loss Adjustment 0.16 Transferred In Cost 2,530,000.00 460,000 5.50 Transferred In Cost 4,200,000.00 420,000.00 10.00
Loss Adjustment 0.25 Loss Adjustment 0.50
TOTAL 2,807,600.00 5.36 TOTAL 5,162,500.00 10.25 TOTAL 5,664,000.00 13.00

COSTS ACCOUNTED FOR AS FOLLOWS: COSTS ACCOUNTED FOR AS FOLLOWS: COSTS ACCOUNTED FOR AS FOLLOWS:
TO: 460,000 units TO: 420,000 units TO: 400,000 units
IP Beg, F & T: 90,000 units IP Beg, F & T: 80,000 units IP Beg, F & T: 80,000 units
Cost, Beg 414,800.00 Cost, Beg 635,000.00 Cost, Beg 464,000.00
Cost added: Cost added: Cost added:
M (0 x 3.00) - M (0 x 2.00) - M (80k x 1.00) 80,000.00
L (60k x 2.00) 120,000.00 L (32k x 1.50) 48,000.00 L (48k x 0.80) 38,400.00
FOH (60k x 0.20) 12,000.00 FOH (32k x 1.00) 32,000.00 FOH (48k x 0.70) 33,600.00
Loss Adj. - 546,800.00 Loss Adj. - 715,000.00 Loss Adj. (48k x 0.50) 24,000.00 640,000.00

PIP, F & T: 370,000 units Received, F & T: 340,000 units Received, F & T: 320,000 units
(370k x 5.36) 1,983,200.00 (340k x 10.25) 3,485,000.00 (320k x 13.00) 4,160,000.00

Total Cost of Transferred Out Units: 460,000 units @ 5.5000 2,530,000.00 Total Cost of Transferred Out Units: 420,000 units @ 10.0000 4,200,000.00 Total Cost of Transferred Out Units: 400,000 units @ 12.0000 4,800,000.00

IP, End: 60,000 units IP, End: 100,000 units IP, End: 80,000 units
Cost added: Cost added: Cost added:
M (60k x 3.00) 180,000.00 M (100k x 2.00) 200,000.00 M (0 x 1.00) -
L (40k x 2.00) 80,000.00 L (75k x 1.50) 112,500.00 L (32k x 0.80) 25,600.00
FOH (40k x 0.20) 8,000.00 FOH (75k x 1.00) 75,000.00 FOH (32k x 0.70) 22,400.00
Loss Adj. (60k x 0.16) 9,600.00 Trans In Cost (100k x 5.50) 550,000.00 Trans In Cost (80k x 10.00) 800,000.00
277,600.00 Loss Adj. (100k x 0.25) 25,000.00 962,500.00 Loss Adj. (32k x 0.50) 16,000.00 864,000.00

TOTAL 2,807,600.00 TOTAL 5,162,500.00 TOTAL 5,664,000.00

5. JOURNAL ENTRIES 5. JOURNAL ENTRIES 5. JOURNAL ENTRIES

JOURNAL ENTRIES: JOURNAL ENTRIES: JOURNAL ENTRIES:

1. WIP-Dept I 2,392,800.00 1. WIP-Dept II 1,997,500.00 1. WIP-Dept III 1,000,000.00

Materials 1,350,000.00 Materials 880,000.00 Materials 400,000.00
Payroll 948,000.00 Payroll 670,500.00 Payroll 320,000.00
Applied FOH 94,800.00 Applied FOH 447,000.00 Applied FOH 280,000.00
# # #

2. WIP-Dept II 2,530,000.00 2. WIP-Dept III 4,200,000.00 2. WIP-Dept IV 4,800,000.00

WIP-Dept I 2,530,000.00 WIP-Dept II 4,200,000.00 WIP-Dept III 4,800,000.00
# # #

6. T-Account of WIP Inventory 6. T-Account of WIP Inventory 6. T-Account of WIP Inventory

WIP - Department I WIP - Department II WIP - Department III

Beg. Balance 414,800.00 2,530,000.00 TO Beg. Balance 635,000.00 4,200,000.00 TO Beg. Balance 464,000.00 4,800,000.00 TO
M, L & FOH 2,392,800.00 M, L & FOH 1,997,500.00 M, L & FOH 1,000,000.00
Trans In Cost 2,530,000.00 Trans In Cost 4,200,000.00
Total 2,807,600.00 2,530,000.00 Total Total 5,162,500.00 4,200,000.00 Total Total 5,664,000.00 4,800,000.00 Total Page | 2
End. Balance 277,600 End. Balance 962,500 End. Balance 864,000
1. QUANTITY SCHEDULE 1. QUANTITY SCHEDULE
DEPARTMENT IV DEPARTMENT V
Input: Input:
IP Beg 120,000 IP Beg 160,000 Uneven
Even Application Uneven Application Even Application
Received 400,000 Received 440,000 Application
TUTBAF 520,000 Conversion Costs Materials TUTBAF 600,000 Conversion Costs Materials
Output: Actual % EUP % EUP Output: Actual % EUP % EUP
TO 440,000 IP Beg, F & T 120,000 2/3 80,000 70% 84,000 TO 460,000 IP Beg, F & T 160,000 1/4 40,000 10% 16,000
Received, F&T 320,000 100% 320,000 100% 320,000 Received, F&T 300,000 100% 300,000 100% 300,000
IP, End 60,000 IP, End 60,000 2/3 40,000 80% 48,000 IP, End 100,000 IP, End 100,000 1/5 20,000 50% 50,000
Normal Loss 20,000 Normal Loss 20,000 100% 20,000 100% 20,000 Normal Loss 40,000 Normal Loss 40,000 25% 10,000 50% 20,000
TUAF 520,000 Total 520,000 460,000 472,000 TUAF 600,000 Total 600,000 370,000 386,000

2. REMAINING UNITS 2. REMAINING UNITS

Remaining Units = Completed Units IP Beg, F & T Yes Remaining Units = Units that passed thru POL IP Beg, F & T No
= TO Received, F&T Yes = Received, F&T Yes
= 440,000 IP, End No = 300,000 IP, End No

3. LOSS ADJUSTMENT 3. LOSS ADJUSTMENT

Loss Adjustment: Loss Adjustment:

Normal Loss: 20,000 units Normal Loss: 40,000 units
M (20k x 2.50) 50,000 M (20k x 2.40) 48,000
L (20k x 1.50) 30,000 L (10k x 1.40) 14,000
FOH (20k x 0.50) 10,000 FOH (10k x 0.60) 6,000
Trans In Cost (20k x 12.00) 240,000 Trans In Cost (40k x 16.00) 640,000
Cost of Normal Loss 330,000 Cost of Normal Loss 708,000
Divided by: Remaining Units 440,000 Divided by: Remaining Units 300,000
Loss Adjustment 0.75 Loss Adjustment 2.36

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4. COST OF PRODUCTION REPORT 4. COST OF PRODUCTION REPORT
DEPARTMENT IV DEPARTMENT V
COSTS TO BE ACCOUNTED FOR: Costs EUP Unit Cost COSTS TO BE ACCOUNTED FOR: Costs EUP Unit Cost
Costs added this month: Costs added this month:
M 1,180,000.00 472,000 2.50 M 926,400.00 386,000 2.40
L 690,000.00 460,000 1.50 L 518,000.00 370,000 1.40
FOH 230,000.00 460,000 0.50 FOH 222,000.00 370,000 0.60
Total 2,100,000.00 4.50 Total 1,666,400.00 4.40
Cost, Beg 1,060,000.00 Cost, Beg 2,253,600.00
Transferred In Cost 4,800,000.00 400,000.00 12.00 Transferred In Cost 7,040,000.00 440,000.00 16.00
Loss Adjustment 0.75 Loss Adjustment 2.36
TOTAL 7,960,000.00 17.25 TOTAL 10,960,000.00 22.76

COSTS ACCOUNTED FOR AS FOLLOWS: COSTS ACCOUNTED FOR AS FOLLOWS:

TO: 440,000 units TO: 460,000 units
IP Beg, F & T: 120,000 units IP Beg, F & T: 160,000 units
Cost, Beg 1,060,000.00 Cost, Beg 2,253,600.00
Cost added: Cost added:
M (84k x 2.50) 210,000.00 M (16k x 2.40) 38,400.00
L (80k x 1.50) 120,000.00 L (40k x 1.40) 56,000.00
FOH (80k x 0.50) 40,000.00 FOH (40k x 0.60) 24,000.00
Loss Adj. (120k x 0.75) 90,000.00 Loss Adj. - 2,372,000.00
1,520,000.00
Received, F & T: 320,000 units Received, F & T: 300,000 units
(320k x 17.25) 5,520,000.00 (300k x 22.76) 6,828,000.00

Total Cost of Transferred Out Units: 440,000 units @ 16.0000 7,040,000.00 Total Cost of Transferred Out Units: 460,000 units @ 20.0000 9,200,000.00

IP, End: 60,000 units IP, End: 100,000 units

Cost added: Cost added:
M (48k x 2.50) 120,000.00 M (50k x 2.40) 120,000.00
L (40k x 1.50) 60,000.00 L (20k x 1.40) 28,000.00
FOH (40k x 0.50) 20,000.00 FOH (20k x 0.60) 12,000.00
Trans In Cost (60k x 12.00) 720,000.00 Trans In Cost (100k x 16.00) 1,600,000.00
Loss Adj. - 920,000.00 Loss Adj. - 1,760,000.00

TOTAL 7,960,000.00 TOTAL 10,960,000.00

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5. JOURNAL ENTRIES 5. JOURNAL ENTRIES

JOURNAL ENTRIES: JOURNAL ENTRIES:

1. WIP-Dept IV 2,100,000.00 1. WIP-Dept V 1,666,400.00

Materials 1,180,000.00 Materials 926,400.00
Payroll 690,000.00 Payroll 518,000.00
Applied FOH 230,000.00 Applied FOH 222,000.00
# #

2. WIP-Dept V 7,040,000.00 2. FG 9,200,000.00

WIP-Dept IV 7,040,000.00 WIP-Dept V 9,200,000.00
# #

6. T-Account of WIP Inventory 6. T-Account of WIP Inventory

WIP - Department IV WIP - Department V

Beg. Balance 1,060,000.00 7,040,000.00 TO Beg. Balance 2,253,600.00 9,200,000.00 TO
M, L & FOH 2,100,000.00 M, L & FOH 1,666,400.00
Trans In Cost 4,800,000.00 Trans In Cost 7,040,000.00
Total 7,960,000.00 7,040,000.00 Total Total 10,960,000.00 9,200,000.00 Total
End. Balance 920,000 End. Balance 1,760,000

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