Sanchez, Mark Laurence S.

BSA 2106
Cost Accounting

EXERCISES:
Multiple Choice
1. The product of Pili Mfg. Co passes through three producing departments namely, A,
B and C. The department unit costs for April and May 2014 were as follows:
Dept A Dept B Dept C
April P 5.00 P 8.00 P 4.00
May 5.80 7.50 4.30

As of May 31, there are 10,000 units in process in Dept C, ½ done. They were placed
in process in Dept A in April, transferred to Dept B in April, and then transferred to
Dept. C in May. Assuming that these 10,000 units comprise the only work in process
inventory for each of the last three months, how much must be their accumulated
cost?

a. P 151,500
b. P 146,500
c. P 154,500
d. Not given

2. The following data are given on the production of Perez Mfg. Co. for July 2014:
Total equivalent production 28,500
Placed in process, finished and transferred 20,000
Finished and on hand 6,000 units
In process, end 8,000 units, 1/8 done
In process, beginning ? units, 1/4 done
Placed in process ?
The FIFO costing method is used.
How many units were there in the beginning inventory of work in process?

a. 2,000
b. 1,500
c. 6,000
d. Not given

3. The following data are given on the production of Sumigla Mfg. Co. for June, 2014

Quantity data:
In process, June 1 8,000 units, 1/4 done
 Placed in process 40,000 units
Finished and on hand 6,000 units
In process, June 30 3,000 units, 1/3 done
Cost data:
Work in process, June 1 P 4,390
Factory costs, June:
Materials 52,800
Labor 22,000
Factory overhead 13,200
Costs are applied evenly throughout the process.
What must be the unit cost of those completed and transferred out as finished goods?

a. P 2.00
b. P 2.01
c. P 2.09
d. Answer not given

4. Acapulco Mfg. Co processes its product in three consecutive departments, A, B

and C. The following data are given on the third department’s production for July,
2014:
Quantity data:
In process, July 1 5,000 units, 4/5 done
Transferred in 22,000 units
In process, July 31 8,000 units, 3/4 done
Cost data:
In process, July 1 P 30,610
Transferred in 110,000
Factory costs, July:
Materials 15,750
Labor 8,400
Factory overhead 6,300
What unit cost must be assigned to the units transferred out?

a. P 6.45
b. P 6.44
c. P 1.45
d. Not given

5. In August, 2014, Department B of Sumulong Mfg. Co. received 30,000 units (@ P

6.20) from Department A. As of August 31, 2014, 3,000 units are still in process, 2/3 done.
On August 1st, there were 2,000 units in process (1/4 done) with accumulated cost of P
12,585. Department B incurred the following in August: materials, P 21,350; labor P
4,575. Factory overhead rate is 66 2/3 % of labor cost.
 What value must be assigned to the ending inventory of work in process?

a. P 20,500
b. P 14,300
c. P 19,550
d. Not given

6. Taguig Mfg. Co. has its product processed in two consecutive departments, M and
P. In Dept. M, materials are added at the start of the process while in Dept. , materials
are added when goods are 60% done. Labor and factory overhead are evenly applied
throughout the processes. The following data are given on the operations of these two
departments for September, 2014:
Department M Department P
Stage of Stage of
Units completion Units completion

In process, Sept.
1 3,000 60% 2,000 20%
Placed in process 20,000
Transferred in 16,000
In process,Sep30 ? 40% ? 80%
Transferred out ? 15,500

What should be the equivalent units of production for each of the two departments?
Department M Department P
Conversion Conversion
Materials Cost Materials Cost
a.
20,000 17,600 16,000 17,100
b.
16,000 17,600 16,000 15,900
c.
20,000 17,000 18,000 17,100
d. D None of the above

7. Parang Mfg. Co. adds all the materials at the start of the process. The following
data are given on its production for October, 2014:

Quantity data:
In process, Oct 1 1,000 units, 1/5 done
Placed in process 28,000 units
In process, Oct 31 6,000 units, 1/4 done
Cost data:
In process, Oct 1 P 1,420
 Factory costs, October:
Materials 42,000
Labor 12,150
Factory overhead rate: 50% of labor cost

What must be the unit cost of those transferred to stockroom during the month?

a. P 2.25
b. P 2.24
c. P 2.59
d. None of these

8. Department II of Lanzones Mfg. Co. adds all the materials at the middle of the
process. The following information pertains to the November, 2014 production:

Quantity data:
In process, Nov 1 8,000 units, 1/4 done
Transferred in 50,000 units
In process, Nov 30 3,000 units, 3/5 done

Cost data:
In process, Nov 1 P 9,450
Transferred in 50,000
Factory costs, November:
Materials 29,000
Labor 13,700
Factory overhead rate: 80% of labor cost
How much must be the ending inventory of work in process?

a. P 5,850
b. P 2,310
c. P 5,310
d. Not given