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# Prepared by: Brian Christian S.

Villaluz, CPA

Process Costing

Part I: Computation of Equivalent Units of Production (EUP) without spoilage

Problem 1:
Double Click Manufacturing Co. uses process costing in the manufacture of its sole product. The following
production data are presented to you:

Beginning inventory (40% converted) 10,000 units
Started in process 75,000 units
Ending inventory (60% converted) 20,000 units

All materials are added at the start of processing.

1. Using average costing, compute for the EUP for materials and conversion.
2. Using FIFO, compute for the EUP for materials and conversion.

Problem 2:
Double Click Manufacturing Co. uses process costing in the manufacture of its sole product. The following
production data are presented to you:

Beginning inventory (40% to complete) 10,000 units
Started in process 75,000 units
Ending inventory (60% to complete) 20,000 units

All materials are added at the end of processing.

1. Using average costing, compute for the EUP for materials and conversion.
2. Using FIFO, compute for the EUP for materials and conversion.

Problem 3:
Double Click Manufacturing Co. uses process costing in the manufacture of its sole product. The following
production data are presented to you:

Transferred out 120,000 units
Started in process 150,000 units
Ending inventory (7/8 converted) 45,000 units

Forty percent of materials is added when the processing is halfway completed; balance when 80%
completed. Beginning inventory, if any, need 3/5 to be completed.

1. Using average costing, compute for the EUP for materials and conversion.
2. Using FIFO, compute for the EUP for materials and conversion.

Problem 4:
Double Click Manufacturing Co. uses process costing in the manufacture of its sole product. The following
production data are presented to you:

Beginning inventory (¾ to complete) 8,000 units
Transferred out 40,000 units
Units started 60,000 units
Ending inventory (6/7 completed) ???

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The following production data are presented to you: Units started 100. materials are added at various points in the production. These were 20% converted. Problem 5: Monique Textile Inc. Villaluz.500 units Started in process 75.500 units Abnormal spoilage 5. compute for the EUP for materials and conversion. compute for the EUP for materials and conversion. Using average costing. Using FIFO. The remainder was behind 25% from completion. Using average costing. Problem 7: The following information is available for BGC Company for the current period: Beginning WIP (75% complete) 14.000 units WIP.000 units Normal spoilage 3. end (30% incomplete) 14.000 units WIP.. uses process costing in the manufacture of its sole product.000 units. Using FIFO. Using average costing. remaining materials are added when the units are 90% converted. Due to the complexity of this textile. 4. To sum up: Direct materials: 40% are put into production at the beginning 50% are placed when the fabrics are 55% completed 10% are placed when the fabrics are 99% done 1.000 units Abnormal spoilage 2.000 units were in process. Using FIFO.000 units Ending WIP (60% complete) 16.000 units Normal spoilage 5. Cherry inspects goods at 75% completion as to conversion.500 units All materials are added at the start of the process.500 units All materials are added at the start of production. 1. compute for the EUP for materials and conversion. Part II: Computation of Equivalent Units of Production (EUP) with spoilage Problem 6: Cherry Manufacturing Co. compute for the EUP for materials and conversion. 2. (35% complete) 20. For the current month. Only 12. compute for the EUP for materials and conversion.000 of these were completed. CPA 20% of materials is added when the units are 25% completed. 2 . Prepared by: Brian Christian S. 2. produces sophisticated fabrics that are being supplied to 5-star hotels and to high- end condominiums that require components to be integrated in various points of the production. compute for the EUP for materials and conversion. Monique started to produce 16. 1. beg. At the beginning of the month. 2.

uses process costing in the manufacture of its sole product. beg. Problem 9: Cherry Manufacturing Co. Compute for the cost assigned to units completed. Compute for the cost of abnormal lost units.000 units WIP.000 units WIP. Using average costing… 6. Compute for the cost per EUP for materials and conversion. end (20% incomplete) 14. 8.000 Conversion 210. Part III: Cost of production report (with spoilage) Problem 8: Cherry Manufacturing Co.000 Conversion 210. Compute for the cost assigned to the ending inventory. The following information is available for the current year: Units started 100.000 3 .500 units Cost of beginning WIP Material P90. 3. 2.000 units Normal spoilage 3. CPA 1. 7. Compute for the cost per EUP for materials and conversion.500 units Cost of beginning WIP Material P90. 10. Using FIFO… 1. (35% complete) 20. Cherry inspects goods at 75% completion as to conversion. 2. Compute for the cost assigned to the ending inventory. Using FIFO. Compute for the cost of abnormal lost units. The following information is available for the current year: Units started 100. Compute for the EUP for materials and conversion. uses process costing in the manufacture of its sole product.000 units WIP.000 units WIP. 9. beg. end (30% incomplete) 14.000 units Normal spoilage 3. Villaluz. 4.500 units Abnormal spoilage 5. Using average costing.000 Current cost Material 690. Compute for the EUP for materials and conversion.000 Conversion 471.150 All materials are added at the start of the process. Compute for the cost assigned to units completed. 5. compute for the EUP for materials and conversion.500 units Abnormal spoilage 5. compute for the EUP for materials and conversion. (35% complete) 20. Prepared by: Brian Christian S.

000 Conversion 471. Compute for the EUP for materials and conversion.500 units Abnormal spoilage 5. 6. 8. 2. beg. Using FIFO… 1. Using average costing… 5. 2. Compute for the cost assigned to the ending inventory. Compute for the EUP for materials and conversion.000 Current cost Material 690. Compute for the cost per EUP for materials and conversion. Problem 10: Cherry Manufacturing Co. 4. Prepared by: Brian Christian S. Compute for the EUP for materials and conversion. Using average costing… 5. Compute for the cost assigned to units completed.150 All materials are added at the start of the process. 6.000 units WIP. (80% complete) 20. 3. Compute for the cost assigned to units completed.000 Conversion 210. Compute for the cost per EUP for materials and conversion. uses process costing in the manufacture of its sole product. Compute for the cost assigned to units completed. Compute for the EUP for materials and conversion. Compute for the cost assigned to units completed. 8. Compute for the cost per EUP for materials and conversion. Using FIFO… 1.500 units Cost of beginning WIP Material P90.000 Conversion 471. Compute for the cost assigned to the ending inventory.000 units WIP. 4. end (20% incomplete) 14. CPA Current cost Material 690. Compute for the cost assigned to the ending inventory. Compute for the cost assigned to the ending inventory. Cherry inspects goods at 75% completion as to conversion. 7.000 units Normal spoilage 3.150 All materials are added at the start of the process. Cherry inspects goods at 75% completion as to conversion. 3. 4 . Villaluz. Compute for the cost per EUP for materials and conversion. The following information is available for the current year: Units started 100. 7.

2016 work-in-process inventory? Part V: Comprehensive problem (with spoilage) Exciting Company applies process costing in the manufacture of its sole product.000 FINISHING DEPARTMENT Units: Cost: January 1.000 December 31. (b) It is the company’s policy to add all direct materials in the assembly department at the start of the process while all direct materials in the finishing department are added at the end of the process. and conversion? 6.000 Direct labor – P40.000 December 31.000. 2016 work-in-process inventory? In the finishing department… 5.000 units – 10% incomplete as to conversion ??? Units started during 2016 ??? Transferred In – ??? Direct materials – P30. 2016 150. materials.000 units Direct materials – P12. What is the EUP for transferred in. and conversion? 7.000. CPA Part IV: Comprehensive problem (without spoilage) A company employs FIFO process costing system concerning its only product which undergoes production in assembly department and finishing department. 2016 50.000 Direct labor – P5.000.000 Factory overhead – P13. What is the cost assigned to December 31. 2016? 8.000 Direct labor – P15.000 units – 70% incomplete as to conversion Transferred In – P10.000 Factory overhead – P10.000. materials.000.000 units – 40% complete as to conversion Direct materials – P3.000 Factory overhead – P2.000.000. Villaluz.000.000. Manufacturing starts in Department 1 where materials are all added at the start of processing.000 units – 80% complete as to conversion ??? Units started during 2016 400.000. 2016 are provided: ASSEMBLY DEPARTMENT Units: Cost: January 1.000.000 Direct materials – P6. (c) There is no spoilage in both departments. What is the cost assigned to December 31. What is the cost of goods manufactured or cost assigned to units completed for the year ended December 31. How much is the cost per EUP for materials and conversion? 3. The good units are then transferred to Department 2 where all the incremental materials needed for its completion are added after final 5 . 2016 100.000 Additional information: (a) It is the company’s policy to add conversion cost evenly throughout the period in the two departments.000.000. What is the cost of goods manufactured or cost assigned to units completed for the year ended December 31. The following data for the year ended December 31. Prepared by: Brian Christian S. In the assembly department… 1.000 Factory overhead – P3.000 Direct labor – P1. 2016? 4. 2016 30. What is the EUP for materials and conversion? 2. How much is the cost per EUP for transferred in.

2016? 8. WIP Transferred in . What is the EUP for materials and conversion? 2. The following production data for August show: Department 1 Department 2 QUANTITY SCHEDULE Beg.000 - Conversion costs 6. 2016 work-in-process inventory? END  -BCSV- 6 . and conversion? 6.000 7. P3. What is the cost assigned to December 31. Prepared by: Brian Christian S.000 Abnormal loss 800 500 COST DATA Beg. What is the cost assigned to December 31.300 Transferred in .000 62. What is the cost of goods manufactured or cost assigned to units completed for the year ended December 31. 2016 work-in-process inventory? DEPARTMENT 2 5.000 Stage of completion 2/3 5/7 Put into process 44. materials. What is the cost of goods manufactured or cost assigned to units completed for the year ended December 31.200 1.500 4. In both departments. units are inspected at the end of processing. How much is the cost per EUP for materials and conversion? 3.000 Current period costs Materials 88.000 4.000 - Normal loss 1.710 Materials P9. CPA inspection. What is the EUP for transferred in.000 Stage of completion 1/3 4/5 Ending WIP 9. 2016? 4. ??? DEPARTMENT 1 1. WIP 6.100 Conversion costs 67.500 49. Villaluz. How much is the cost per EUP for materials and conversion? 7. Department 1 uses FIFO while Department 2 uses average costing.

525 2. 30. DM – 65.923.000. 55. 81.30 7. CC – 45. 155.375 2.000 6.00 8. 4.000. 12. DM – 100. 3. 1. 6. DM – 44. 5.760 5.000.42 3.89 7.238.500. DM – 370. 160.08.000. CC – 18.000.12 3.412 8.375 1. 41. DM .000.687. DM – 85. 1.000.264. 1. 27. 144.80.251.525 7. 6.000 2.50.37. 155. 6. DM – 165. 37. CC – 113.600.000 1. CC – 153.50. 107.50 3.314.000.000 PROBLEM 3: PROBLEM 9: 1. DM – 70.50. CC – 382. 4.68.000 2.000 1. 5. CC – 159. 1. 141.100 2.885 8.90.412 8. CC – 106.000 1. CC – 62.525 1.540 PROBLEM 5: Part IV 1.76 3. 1. DM – 18. TI – 350. Villaluz.975 6. 30. CPA ANSWERS: PROBLEM 1: PROBLEM 7: 1. 51.000.000 5. 1.225 PROBLEM 2: PROBLEM 8: 1.000. DM – 19.000.200 4.540 PROBLEM 4: PROBLEM 10: 1.200 2.430. 167.150 10.075 6. 6.600.430 PROBLEM 6: Part V 1. DM – 84.913 5. 6. DM – 65. 43.975 2.92 7.000. 2. DM – 100.000 1.000. DM – 120.92 7. 227. CC – 73.000 9.764. 34. CC – 107. CC – 106.000.090 7 . CC – 114. Prepared by: Brian Christian S. CC – 114.248.000 6. CC – 77. 130.525 2. CC – 19. DM – 120. DM – 165.00.36 3.400.90. DM – 44. DM – 120. CC – 73. CC . CC – 64. DM – 100.000. DM – 120. 6. DM – 100. CC – 67. DM – 45.853 4. CC – 67.000 2.238.000.000. 4.975 2. 167.975 6.729 5. DM – 75. 1.000. 1.161 4.000.254. CC – 78. 65.500.000. 130.042 4.90.000 2.150 8.400 5. 1.000. CC – 98. CC – 113.200 4.000.000 2. 6. 6.