Accounting 6: Cost Accounting and Cost Management

Introduction to Process Costing

Problem 1
QS:
IP, beg
SIP
TUTBAF
IP, end
Transf
CA:
CLM
Mat V
Mat W
Mat Z
CC
CTM
Mat V
Mat W
Mat X
Mat Y
Mat Z
CC
Total Cost

F&T
IP, beg
CP
IP, end
TUTBAF

4,000
23,000
27,000
1,500
25,500 1a

1,800
1,200
960
1,980
10,350
6,900
14,025
6,375
30,540
27,225

Actual
Mat V
Mat W
Mat X
Mat Y
Mat Z
CC
4,000
0
0
4,000
4,000
3,200
2,200 45%comp1b
21,500
21,500
21,500
21,500
21,500
21,500
21,500
1,500
1,500
1,500
0
0
750
1,050 70%comp1c
27,000
23,000
23,000
25,500
25,500
25,450
24,750 1d ; 1e

Unit Cost

5,940 1f
0.45
0.30
0.55
0.25
1.20 1h
95,415
101,355

0.45
IP, beg
CLM
CTM
Mat X
Mat Y
Mat Z
CC
TCOC
CP
CTD
TCOT

5,940
2,200
1,000
3,840
2,420
15,400
82,775
98,175 1g
3.85

0.30

0.55

0.25
IP, end
CTD
Mat V
Mat W
Mat Z
CC
TCOC
TCAAF

1.20

675
450
900
1,155
3,180 1g
101,355

1.10

Accounting 6: Cost Accounting and Cost Management

Introduction to Process Costing
Problem 2
Mixing
QS:
IP, beg
SIP
TUTBAF
IP, end
Transf
CA:
CLM
DM
DL
OH
TCLM
CTM
DM
CC
Total Cost

5
126
131
6
125

1,200
1,280
2,560
5,040
31,440 249.5238095
122,880 975.2380952
159,360

F&T
IP, beg
CP
IP, end
TUTBAF

Actual

Mat
5
120
6
131

IP, beg
CLM
CTM
M
CC
TCOC
CP
CTD
TCOT
IP, end
CTD
Mat
CC
TCOC
TCAAF

CC
0
120
6
126

3
120
3
126

5,040
0
2,925.714286
7,965.714286
146,971.4286
154,937.1429 1,239.497143

1,497.142857
2,925.714286
4,422.857143
159,360

Tableting
QS:
IP, beg
Rec
TUTBAF
IP, end
Transf
CA:
CLM
Mat
DL
OH
TCLM
CTM
CFPD
Mat
CC
Total Cost

F&T
IP, beg
CP
IP, end
TUTBAF

4,000
200,000
204,000
6,000
198,000

320
200
300
820
154,937.1429
15,840
48,600
220,197.1429

0.774685714
0.0792
0.244959677
1.098845391

Actual
Mat
4,000
194,000
6,000
204,000

IP, beg
CLM
CTM
M
CC
TCOC
CP
TCOT
IP, end
CFPD
CTD
M
CC
TCOC
TCAAF

CC
0
194,000
6,000
200,000

820
0
489.9193548
1,309.919355
213,176.0059
214,485.9252
4,648.114284
475.2
587.9032248
5,711.217509
220,197.1429

2,000
194,000
2,400
198,400

Accounting 6: Cost Accounting and Cost Management

Introduction to Process Costing
Problem 3
QS:
IP, beg
200,000
SIP
1,000,000
TUTBAF
1,200,000
IP, end
300,000
Transf

Mat
Labor
OH
IP, beg
CLM
M
L
OH
TCLM
CTM
M
CC
TCOC

F&T
IP, beg
CP
IP, end
TUTBAF

1c
IP, end
FG, end

Actual
Mat
CC
200,000
0
40,000
700,000 700,000 700,000
300,000 300,000 150,000
1,200,000
### 890,000 1a

900,000
Total Cost Unit Cost
1,300,000
1.3000
1,995,000
2.2416
1,197,000
1.3449 1b

200,000
315,000
189,000
704,000
0
143,460
847,460 1c

FG, beg
Comp
FG, end
COGS
Multiply
Total Cost

CP
CTD
TCOT

Adj Bal
Book Bal Over/Und
927,975 680,960 -247,015
948,440 1,009,800
61,360
0
900,000
200,000
700,000
4.7422
### 1d

1e
3,420,550
4,268,010

FG, end
Multiply
Total Cost

200,000
4.7422
948,440 1c

IP, end
CTD
M
CC
TCOC

390,000
537,975
927,975 1c

4.7422

WIP

247,015
FG
COGS

61,360
185,655

Inventories and Income are Understated by 185,655

Accounting 6: Cost Accounting and Cost Management

Introduction to Process Costing
Problem 4
QS:
IP, beg
SIP
TUTBAF
IP, end
Transf

CA:
AAA
BBB
CCC
DDD
Conv Cost
Total Cost

0
300,000
300,000
50,000
250,000

12,000
6,000
18,725
26,000
235,347
298,072

F&T
CP
IP, end
TUTBAF

Actual
AAA
BBB
CCC
DDD
CC
250,000 250,000 250,000 250,000 250,000 250,000
50,000
50,000
50,000
17,500
10,000
30,175
300,000 300,000 300,000 267,500 260,000 280,175 3a

30% ;
35% ;
15% ;
20% ;
Total

BBB
CCC
DDD
15,000
17,500
7,500
7,500
10,000
10,000
10,000
50,000
17,500
10,000

45%
50%
65%
98%

0.04 (12,000/300,000)
0.02 (6,000/300,000)
0.07 (18,725/267,500)
0.10 (26,000/260,000)
0.84 (235,347/280,175)
1.07

F&T
CP
TCOC
TCOT

267,500 (250,000 * 1.07)

267,500
267,500 3b

IP, end
AAA
BBB
CCC
DDD
Conv Cost
TCOC
TCAAF

Note:
RM AAA: beginning of process, so lahat a-apply mo since IP, end ito and not IP, beg
RM BBB: when units are 40% complete
RM CCC: when units are 60% complete
RM DDD: when units are 95% complete
Example:
Yung 30% ng IP, end, which is 50,000, sabi niya eh 45% complete pa lang.
So papasok siya sa RM: BBB lang kasi 60% at 95% ang cut-off sa CCC at DDD.
Yung naman 35% ng 50,000, sabi niya eh 50% complete pa lang.
So same lang din, sa BBB lang papasok
Yung naman 15% ng 50,000, sabi niya eh 65% complete pa lang.
So papasok siya sa BBB at CCC pero hindi sa DDD, kasi 95% ang cut-off sa DDD.
Yung naman last, yung 20% ng 50,000, sabi niya eh 98% complete na.
So papasok siya sa BBB, CCC at DDD dahil abot niya ang lahat ng cut-off.
Let A = 50,000 hence CC = A*.3*.45 + A*.35*.5 + A*.15*.65 + A*.20*.98 = 30,175

2,000 (50,000*0.04)
1,000 (50,000*0.02)
1,225 (17,500*0.07)
1,000 (10,000*0.10)
25,347 (30,175*0.84)
30,572 3c
298,072