School of International Business Advanced Management Accounting
Spring 2025 Tutorial 1
Chapter Four
Solution: Exercise 4-7
Work in Process—Cooking ............ 42,000
Raw Materials Inventory.......... 42,000
Work in Process—Cooking ............ 50,000
Work in Process—Molding ............ 36,000
Salaries and Wages Payable .... 86,000
Work in Process—Cooking ............ 75,000
Work in Process—Molding ............ 45,000
Manufacturing Overhead ......... 120,000
Work in Process—Molding ............ 160,000
Work in Process—Cooking ....... 160,000
Finished Goods ............................ 240,000
Work in Process—Molding ....... 240,000
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School of International Business Advanced Management Accounting
Spring 2025 Tutorial 1
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School of International Business Advanced Management Accounting
Spring 2025 Tutorial 1
Solution: Exercise 4-11
Weighted-Average Method
1. Equivalent units of production
Pulping Conversion
Transferred to next department........................ 157,000 157,000
Equivalent units in ending work in process
inventory:
Pulping: 8,000 units x 100% complete ........... 8,000
Conversion: 8,000 units x 25% complete ........ 2,000
Equivalent units of production .......................... 165,000 159,000
2. Cost per equivalent unit
Pulping Conversion
Cost of beginning work in process ................ $ 4,800 $ 500
Cost added during the period ....................... 102,450 31,300
Total cost (a) .............................................. $107,250 $31,800
Equivalent units of production (b) ................ 165,000 159,000
Cost per equivalent unit (a) ÷ (b) ................ $0.65 $0.20
3. and [Link] of ending work in process inventory and units
transferred out
Pulping Conversion Total
Ending work in process inventory:
Equivalent units ....................... 8,000 2,000
Cost per equivalent unit ........... $0.65 $0.20
Cost of ending work in process
inventory ............................... $5,200 $400 $5,600
Units completed and transferred out:
Units transferred to the next
department ........................... 157,000 157,000
Cost per equivalent unit ........... $0.65 $0.20
Cost of units completed and
transferred out....................... $102,050 $31,400 $133,450
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School of International Business Advanced Management Accounting
Spring 2025 Tutorial 1
5. Cost reconciliation
Costs to be accounted for:
Cost of beginning work in process inventory
($4,800 + $500) ........................................ $ 5,300
Costs added to production during the period
($102,450 + $31,300) ................................ 133,750
Total cost to be accounted for ....................... $139,050
Costs accounted for as follows:
Cost of ending work in process inventory ...... $ 5,600
Cost of units completed and transferred out .. 133,450
Total cost accounted for ............................... $139,050
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School of International Business Advanced Management Accounting
Spring 2025 Tutorial 1
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School of International Business Advanced Management Accounting
Spring 2025 Tutorial 1
Solution: Problem 4-13
Weighted-Average Method
1. Computation of equivalent units of production:
Mixing Materials Conversion
Units transferred to the next department .... 50.0 50.0 50.0
Equivalent units in ending work in process
inventory:
Mixing: 1 unit × 100% complete ........... 1.0
Materials: 1 unit × 80% complete ......... 0.8
Conversion: 1 unit × 70% complete ...... 0.7
Equivalent units of production .................... 51.0 50.8 50.7
2. Costs per equivalent unit:
Mixing Materials Conversion
Cost of beginning work in process
inventory ............................................... $ 1,670 $ 90 $ 605
Cost added during the period .................... 81,460 6,006 42,490
Total cost (a) ........................................... $83,130 $6,096 $43,095
Equivalent units of production (b) ............. 51.0 50.8 50.7
Cost per equivalent unit (a) ÷ (b) ............. $1,630 $120 $850
3. and 4. Costs of ending work in process inventory and units
transferred out:
Mixing Materials Conversion Total
Ending work in process
inventory:
Equivalent units ................... 1.0 0.8 0.7
Cost per equivalent unit ....... $1,630 $120 $850
Cost of ending work in $2,321
process inventory .............. $1,630 $96 $595
Units completed and transferred
out:
Units transferred to the next
department ....................... 50.0 50.0 50.0
Cost per equivalent unit ....... $1,630 $120 $850
Cost of units transferred out. $81,500 $6,000 $42,500 $130,000
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School of International Business Advanced Management Accounting
Spring 2025 Tutorial 1
5. Cost reconciliation:
Cost to be accounted for:
Cost of beginning work in process inventory
($1,670 + $90 + $605) .............................. $ 2,365
Cost added to production during the period
($81,460 + $6,006 + $42,490) ................... 129,956
Total cost to be accounted for....................... $132,321
Costs accounted for as follows:
Cost of ending work in process inventory ...... $ 2,321
Cost of units transferred out ......................... 130,000
Total cost accounted for ............................... $132,321