1.

AMADO Company is using the average process costing system in its manufacturing
procedures. It produces product X which undergoes three departments: Ingal, Enshell, and
Iglum.

 
Ingal is the first department where materials are added at the beginning. All units were
completed during the month except for 2,150 ending inventory with a total cost of
P33,475.50. These are 70% incomplete as to conversion costs. There were no
beginning inventories in this department. The total conversion cost during the month per
EUP is P13. The conversion cost of the units transferred out is P96,980.
 
Enshell, the second department, adds materials when the units are 40% completed as
to conversion costs. In this department, the units experience continuous losses. The
losses however must not exceed 10% of the units transferred in. Units lost in Enshell is
1,000. 500 units of beginning inventory in this department is 30% completed as to
conversion costs has a total cost of P97,000. P80,000 of this cost is transferred in from
Ingal. Costs added during the month for materials and conversion costs are P50,000
and P100,000, respectively. Units transferred out is 6,030. Half of the ending inventory
is 90% to complete as to conversion costs and the remaining is 30% completed as to
conversion costs.
 
Iglum is the last department before the units can be sold. In Iglum, materials are added
at the beginning which will result to accretion. The units transferred in increased by
20%. Beginning inventory of 1,000 units has a transferred in, material and conversion
costs of P131,000, P103,000, and P77,000. Costs incurred during the month for
materials and conversion costs were P200,000 and P100,000 and the ending inventory
is 1,800 units. The beginning and ending inventories are 70% and 50% complete as to
conversion costs.

1. How much is the cost of units transferred out from Ingal?

2. How much is the cost per EUP of material from Ingal?
3. How much of the production costs were absorbed by the normal lost units in Enshell?
4. How much of the production costs were absorbed by the abnormal lost units in
Enshell?
5. How much costs were transferred out to Iglum from Enshell?
6. How much is the cost per EUP of transferred in units in Iglum?
7. How much work-in-process must be included in the inventory section of the entity's
balance sheet?
8. How much is the total cost of a finished unit in Igram?

P-Q2
Started: Oct 3 at 8:50pm

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Question 18

2. AMADO Company is using the average process costing system in its manufacturing procedures.
It produces product X which undergoes three departments: Ingal, Enshell, and Iglum.

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Question 26

ARCHIBALD Company is selling product Tyron and Virgilio. The production process also
produces a by-product Jefferson. Joint costs during the month is P500,000. The by-product
is recognized when produced using the reverse method. Joint costs are allocated on the
basis of sales value at split-off method. Relevant information are as follows:

Units produced
20,000
30,000
2,000
Joint costs
P500,000
Additional processing Costs
P100,000
P200,000
P1,000
Gross profit % based on sales
40%
40%
 

Jefferson has a selling price of P4,000 for all 2,000 units. The cost to sell is P500. Mark-up based on sales
is 46%. The credit term for this by-product is 2/10 n/30 which the customers are accustomed to take.

1. How much joint costs were absorbed by Jefferson?

2. How much joint costs were absorbed by Tyron? by Virgilio?

3. After considering the sales of Jefferson, what is the gross margin of the company?

4. How much are the sales of Tyron? of Virgilio?