PROCESS COSTING:

1. The Luma Company Manufactures toy cars. In Department 1, the body of the toy car is formed
out of plastic. In Department 2 four rubber wheels are placed on each car at the end of the
process. Below is the activity of Department 2 of May:

Units transferred in 15,000

Cost of transferred in P 13,500
Cost incurred by Department 2:
Direct Materials P .02 each rubber wheel
Conversion costs P 14,210
Units in process, end 3,000 (2/3 complete as to conversion, no direct materials)

What is the total costs of completed units transferred out to Department 2?

2. The production data from Department 2 are as follows:

Units received from preceding department 55,000 units

Units Added to production 5,000 units
Units finished and transferred out 48,000 units
Ending units in process
(DM, 100% complete, CC 70% complete) 12,000 units
Cost from preceding department P 24,750
Costs added by department:
Materials P 7,200
Conversion Costs P 53,580

What is the total unit cost?

3. Data for Department 2 for the month of July 2022 follows:
Beginning units in process 0
Unit transferred In 13,000
Costs transferred In P 16,120
Ending Units in process (45% completed for CC) 2,000
Direct Materials P 2,860
Conversion Costs P 9,996

Materials added in Department 2 did not increase the number of units

Compute the equivalent unit of production.

4. The October data for WideLeg Company are shown below:

  Dept 1 Dept 2
Units started in process 25,000  
Units received from previous dept   15,000
Units transferred to finished
goods   7,000
Units completed but not
transferred   1,000
10,000 (80%, 7,000 (75%
Ending units in process DM; 65% CC) CC
     
Cost added by department:    
Direct Materials P 12,650  
Direct Labor P 13,545 P 9,805
Factory Overhead(applied) P 5,160 P 6,625

Compute the equivalent unit of production.

5. Consider the following data for the Assembly department of Cora Manufacturing Company:

Quantity    
Work In Process May 1   80
Started In May   500
Completed during May   460
Work In Process May 31   120
     
Stage of Completion WIP, beg WIP,end
Materials' 90% 60%
Conversion Costs 40% 30%
     
Conversion
Cost Data: Materials Costs
Work In Process May 1 P 49,336 P 9,104
Cost added during May P 322,000 P 139,200
The assembly department uses the weighted average method of process costing.

What are the equivalent units for direct materials and conversion costs?

What is the cost of units completed transferred out and the ending work in process?

6. Regina Manufacturing uses the FIFO method of process costing. The production report for the Curing
Department, where the materials are added at the beginning of the period, for September was as
follows:

In process, beginning of the period 3,000 units

Stage of completion 30 %
 Transferred out during period 12,000 units
In process, end of the period 6,000 units
Stage of completion 40 %

The number of equivalent units for conversion costs during the period was:

7. Department A is the first stage of Run Company’s production cycle. The following information is available
for the conversion costs for the month of April 2022:

WIP, beginning (60%complete) 20,000 units

Started in April 340,000 units
Transferred out 320,000 units
WIP, end (40% complete) 40,000 units

What is the equivalent units for conversion cost under FIFO and WAVE?
8. The following information is available for the month of April from the First department of the RM
Corporation:

Units
Work in process, April 1 (50% complete) 90,000
Started in April 250,000
Transferred to Second Department in April 280,000
Work in process, April 30 (40% complete) 60,000

Materials are added in the beginning of the process in the First department. Using the average cost
method, what are the equivalent units of production for the month of April?

9. Tom Manufacturing company uses FIFO costing method to account for their inventories. The following
information pertains to operations for the month of May 2022:
Beginning work in process, May 1 16,000 units
Started in production during May 100,000 units
Completed production during May (TO) 92,000 units
Ending work in process inventory, May 31 24,000 units

The beginning inventory was 60% complete for materials and 20% complete for conversion costs. The
ending inventory was 90% complete for materials and 40% complete for conversion costs.

Cost pertaining to the month of May are as follows:

- The beginning inventory costs are: materials P54,560; direct labor P 20,320 and overhead
P 15,240
- Cost incurred during May are: materials used P 468,000; direct labor P 182,880 and
overhead P 391,160

What are the equivalent units of production for materials and conversion costs?
 What are the equivalent unit cost of materials and conversion costs for May?

What is the total cos of units in the ending work in process inventory at May 31?

10. The cost data and production data for Gem Company for the month of June were as follows:
Cost data:
Work In Process, June 1: Materials P 20,800
Conversion Costs P 27,600
Cost added this month : Materials P 240,000
Conversion Costs P 640,800
Production Data:
Work In Process, June 1 (40% complete) 3,750 units
Started in production this June 40,000 units
Transferred Out 36,250 units
Work In Process, June 30 (70% complete ) 6,500 units
Normal Lost units 550 units
Abnormal lost units ?
All materials are added at the start of the process and lost units are detected at the inspection of 75%
completion.

a. Using FIFO method, what are the cost assigned to units transferred out and units in ending work in
process?
b. Using Weighted Average method, what are the cost assigned to units transferred out and units in
ending work in process?
c. What is the cost of abnormal units using FIFO and Weighted Average?