Part I.

Vance Manufacturing Company began June 2011 with 10,000 units of inventory in process, 20
percent completed. During the period, 50,000 units were completed and transferred to the
finished goods warehouse. Ending inventory consisted of 5,000 units, 70 percent completed.
Materials were added at the beginning of the process.

Required:

Calculate the equivalent units for:

1. Materials costs under the weighted average process cost method.

2. Conversion costs under the weighted average process cost method.

3. Materials costs under the FIFO process cost method.

4. Conversion costs under the FIFO process cost method.

Part II.
Heap Company manufactures a product that passes through two processes: Fabrication and
Assembly. The following was obtained for the Fabrication Department for September:

a. All materials are added at the beginning of the process.

b. Beginning work in process had 80,000 units, 30% complete with respect to conversion costs.
c. Ending work in process had 17,000 units, 25% complete with respect to conversion costs.
d. Started in process, 95,000 units

5. How much is the equivalent units of production for direct materials using the weighted average
method?

6. How much is the equivalent unit of production for conversion costs using weighted average
method?

7. How much is the equivalent units of production for direct materials using the FIFO method?

8. How much is the equivalent units of production for conversion costs using the FIFO method?
Problem 2

Toyco manufactures a wooden toy product in a two-stage production process. Wood material is
brought into the Forming Department where it is shaped. Shaped products are then moved to
the Finishing Department where metal is added. The following data is given for the Forming
Department for April:

Units for April:

Work in process, beginning inventory April 1 300 units
Direct materials (100% complete)
Conversion (60% incomplete)

Units started in April: 2,200 units

Work in process, ending inventory April 30 500 units
Direct materials (100% complete)
 Conversion (25%)

Costs for April:

Work in process, beginning inventory
Direct materials P7,100
Conversion P4,525

Costs added during April:

Direct materials P70,400
Conversion P40,100

Round to two decimal places.

Required:

9. How many units were transferred to Finishing?

10. How many units were started and completed during April?

11. How many equivalent units of conversion does it take to complete the beginning inventory in the
current period?

12. What is the FIFO cost assigned to the ending inventory?

13. What is the FIFO cost assigned to the units transferred out?

Part IV.
Xi Corporation produces a product that passes through two departments. For July, the following
equivalent unit schedule was prepared for the first department:

Materials Conversion
Units completed 180,000 180,000
Units, EWIP ´ fraction complete:
15,000 x 100% 15,000
15,000 x 40% 6,000
Equivalent units of output 195,000 186,000

Costs assigned to beginning work in process:

Materials: P51,000
Conversion: P24,750

Manufacturing costs incurred during the month:

Materials: P56,250
Conversion: P45,000

Required:

14. Compute the unit cost for July using the weighted average method.

15. Determine the cost of goods transferred out.

16. Determine the cost of ending work in process.

Part V.
Fordman Company has a product that passes through two processes: Grinding and Polishing.
During December, the Grinding Department transferred 20,000 units to the Polishing
Department. The cost of the units transferred into the second department was $40,000. Direct
materials are added uniformly in the second process. Units are measured the same way in both
departments.

The second department (Polishing) had the following physical flow schedule for December:
Units to account for:

Units, beginning work in process 4,000 40% complete

Units started ?

Total units to account for ?

Units accounted for:

Units, ending work in process 8,000 50% complete

Units completed ?
Units accounted for ?

Costs in beginning work in process for the Polishing Department were direct materials, P5,000;
conversion costs, P6,000; and transferred in, P8,000. Costs added during the month: direct
materials, P32,000; conversion costs, P50,000; and transferred in, P40,000.

Required:

17. Assuming the use of the weighted average method, compute the unit cost for the month

18. Assume the company uses the FIFO method, compute the unit cost for the month.

Part VI.
The Sweet Temptations Company has two processing departments, Cooking and Packaging.
Ingredients are placed into production at the beginning of the process in Cooking, where they
are formed into various shapes. When finished, they are transferred into Packaging, where the
candy is placed into heart and tuxedo boxes and covered with foil. All material added in
Packaging is considered as one material for convenience. Since the boxes contain a variety of
candies, they are considered partially complete until filled with the appropriate assortment. The
following information relates to the two departments for February 20X4:

Cooking Department:
Beginning WIP (30% complete as to conversion) 4,500 units
Units started this period 15,000 units
Ending WIP (60% complete as to conversion) 2,400 units

Packaging Department:

Beginning WIP (90% complete as to material, 80% complete as to conversion) 1,000 units
Units started during period ?
Ending WIP (80% complete as to material and 80% complete as to conversion) 500 units

19. Determine equivalent units of production for both departments using the weighted average
method.

20. Determine equivalent units of production for both departments using the FIFO method.

Part VII.
The following costs were accumulated by Department 2 of Hughes Company during April:

Cost Transferred

from Dept. 1 Material Conversion

Beginning Inventory P17,050 P5,450

Current Period Cost 184,000 P 34,000 104,000

Production for April in Department 2 (in units):

WIP-April 1 2,000 60% complete

Complete period transferred 20,000

WIP-April 30 5,000 40% complete

Materials are not added in Department 2 until the very end of processing Department 2.

Required: Compute the cost of units completed and the value of ending WIP for:

a. Weighted average inventory assumption

b. FIFO inventory assumption