Concept explainers
Weighted-average method, assigning costs (continuation of 18-21).
Required
For the data in Exercise 18-21, summarize the total costs to account for; calculate the cost per equivalent unit for direct materials and conversion costs; and assign costs to units completed and transferred out (including normal spoilage), to abnormal spoilage, and to units in ending work-in-process inventory.
18-21 Weighted-average method, spoilage, equivalent units. (CMA, adapted) Consider the following data for November 2017 from MacLean Manufacturing Company, which makes silk pennants and uses a process-costing system. All direct materials are added at the beginning of the process, and conversion costs are added evenly during the process. Spoilage is detected upon inspection at the completion of the process. Spoiled units are disposed of at zero net disposal value. MacLean Manufacturing Company uses the weighted-average method of
a Degree of completion: direct materials, 100%; conversion costs, 45%.
b Degree of completion: direct materials, 100%; conversion costs, 35%.
Required
Compute equivalent units for direct materials and conversion costs. Show physical units in the first column of your schedule.
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Chapter 18 Solutions
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- Management Accounting Required: a. Calculate the cost per equivalent unit for direct materials and conversion costs. b. Determine the dollar value of units completed (and transferred out) and the dollar value of units in ending work in process.arrow_forwarduse the FIFO method to summarize the total costs to account for; calculate the cost per equivalent unit for direct materials and conversion costs; and assign costs to units completed and transferred out (including normal spoilage), to abnormal spoilage, and to units in ending work in process.arrow_forwardSummarize the total costs to account for; calculate the cost per equivalent unit for each cost category; and assign costs to units completed and transferred out (including normal spoilage), to abnormal spoilage, and to units in ending work in process.arrow_forward
- Please look at the photo attached to answer questions below. 1. Prepare a statement of equivalent production to determine the equivalent units for direct materials ( from process 1 & Direct materials added) and conversion costs and the cost per equivalent unit for direct materials and Conversion costs. 2. Calculate the total cost of units completed and transferred to finish goods inventory, calculate cost of abnormal losses and calculate the cost of ending work in process inventory process 2. 3. Prepare better choice’s work -in-process - process 2 T Accounts , clearly showing the ending balancearrow_forwardRequired:(a) Prepare a statement of equivalent production to determine the equivalent units for direct materials(From Process 1 & Direct Material Added), and conversion costs and the cost per equivalent unit fordirect materials and conversion costs. (b) Calculate the:- Total cost of units completed and transferred to Finished Goods inventory- Cost of abnormal losses- Cost of ending work-in-process inventory in Process 2 (c) Prepare Better Choice’s Work-In-Process Inventory - Process 2 T-account, clearly showing theending balance. (d) State the journal entries necessary to record the assignment of direct materials, directmanufacturing wages and manufacturing overhead applied to Process 2. Also give the journalentries to record the cost of goods completed and transferred to finished goods. (e) Given that 20% of the unexpected losses were as a result of pilferage, prepare the abnormalspoilage statement, clearly showing Better Choice’s true loss.arrow_forwarda. Based on the data in Exercise 20-11 (attached), determine the following:1. Cost of beginning work in process inventory completed this period2. Cost of units transferred to finished goods during the period3. Cost of ending work in process inventory4. Cost per unit of the completed beginning work in process inventory, rounded to the nearest centb. Did the production costs change from the preceding period? Explain.c. Assuming that the direct materials cost per unit did not change from the preceding period, did the conversion costs per equivalent unit increase, decrease, or remain the same for the current period?arrow_forward
- That which determine(s) whether the costs assigned to units transferred out and to units in ending work in process are equal to the costs in beginning work in process, plus the manufacturing costs incurred in the current period is(are) called: a.Cost reconciliation b.Transferred-in costs c.Batch production process d.Equivalent unit of outputarrow_forwardiii)Calculate:- Cost per unit of finished product, by element of cost and total.- Cost of units transferred to process 3- Cost of abnormal loss/gain- Cost of uncompleted units in WIP at the end of October.arrow_forwardThe four steps necessary to complete a cost of production report in a process cost system are 1. allocate costs to units transferred out and partially completed units 2. determine the units to be assigned costs 3. determine the cost per equivalent unit 4. compute equivalent units of production The correct ordering of the steps is Oa. 2,4, 3, 1 ОБ. 2,3, 1, 4 Oc. 2,3, 4, 1 Od. 4,2, 3, 1arrow_forward
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