1

CHAPTER 12

Answers to Multiple Choice - Theoretical

1. a 3. a 5. b
2. c 4. b 6. a
7. a

Solutions to Multiple Choice – Computational

1. (b)

Units completed:
From BWIP: (50% x 100) 50
From started in process (100%) 300 350
Work in process, end: (75% x 200) 150
EUP 500

2. (d)

Unit material cost:

Material cost this month P720,000
Divided by EUP ÷ 500
Unit cost P 1,400

Ending work in process: (P1,440 x 150) P216,000

3. (a)

Equivalent unit of production – Labor

Transferred out:
From BWIP: (60% x 1,000) 600
From transferred in 26,000 26,600
Ending work in process: (70% x 4,000) 2,800
EUP 29,400

Unit labor cost:

Labor cost this month P238,140
Divided by EUP ÷ 29,400
Unit labor cost P 8.10

Transferred out:
From BWIP:
Labor cost last month P 3,600
Labor cost this month (600 x P8.10) 4,860 P 8,460
From transferred in; (26,000 x P8.10) 210,600
Overhead cost of units transferred out P219,060
 2

4. (a)

Equivalent units of production – Overhead:

Transferred out:
From BWIP (3,300 x 2/3) 2,200
From transferred in 13,200 15,400
Ending work in process (2,000 x ¾) 1,500
EUP 16,900

Unit overhead cost:

Overhead cost incurred this month P38,025
Divided by EUP ÷16,900
Unit overhead cost P 2.25

Transferred out:
From BWIP:
Overhead cost last month P 2,332
Overhead cost this month (2,200 x P2.25) 4,950 P 7,282
From transferred in (13,200 x P2.25) 29,700
Overhead cost of units transferred out P36,982

5. (b)

Transferred out:
From BWIP (40% x 16,000) 6,400
From SIP 92,000 – 16,000) 76,000 82,400
Ending work in process (90% x 24,000) 21,600
EUP – materials 104,000

6. (d)

Transferred out:
From BWIP (80% x 16,000) 12,800
From SIP 76,000 88,800
Ending work in process (40% x 24,000) 9,600
EUP – conversion cost 98,400

7. (b)

Material cost incurred this month P468,000

Divided by EUP ÷ 104,000
Unit material cost P 4.50

8. (b)

Conversion cost incurred this month P574,040

Divided by EUP ÷ 98,400
Unit conversion cost P 5.83

9. (a)

Materials (21,600 x P4.50) P 97,200

Conversion cost (9,600 x P5.83) 55,968
Cost of EWIP P153,168
 3

10. (a)

Equivalent units of production:

Materials:
Transferred out:
From BWIP (5,000 x 0%) -0-
From SIP (91,400 – 5,000) 86,400 86,400
Ending work in process (4,000 x 100%) 4,000
EUP 90,400

Conversion cost:
Transferred out:
From BWIP (5,000 x 60%) 3,000
From SIP 86,400 89,400
Ending work in process (4,000 x 70%) 2,800
EUP 92,200

Unit costs:
Materials: (P433,920 / 90,400) P 4.80
Conversion cost: (P115,250 / 92,200) 1,25
Total unit costs P 6.05

Transferred out:
From BWIP:
Cost last month P24,875
Cost this month:
Conversion cost (3,000 x P1,25) 3,750 P 28,625
From SIP (86,400 x P6.05) 522,720
Total cost transferred out P551,345

11. (a)

Material costs: (4,000 x P4.80) P19,200

Conversion costs: (2,800 x P1.25) 3,500
Cost of ending work in process P22,700

12. (a)

Gallons transferred out 242,000

Gallons in ending inventory 23,500
Total units accounted for 265,500
Gallons in beginning inventory (36,000)
Gallons started in April 229,500
 4

13. (a)

Equivalent Units of Production:

Material:
Transferred out:
From BWIP: (0%) - 0 -
From SIP: (242,000 – 36,000) 206,000 206,000
Ending work in process: (23,500 x 100%) 23,500
EUP 229.500

Labor:
Transferred out:
From BWIP: (36,000 x 65%) 23,400
From SIP: (100%) 206,000 229,400
Ending work in process: (23,500 x 25%) 5,875
EUP 235,275

Overhead:
Transferred out:
From BWIP: (36,000 x 40%) 14,400
From SIP 206,000 220,400
Ending work in process: (23,500 x 30%) 7,050
EUP 227.450

Unit costs:
Material costs: (P1,131,435 / 229,500) P 4.93
Labor costs: (P451,728 / 235,275) 1.92
Overhead costs: (P773,330 / 227,450) 3.40
Total unit costs P10.25

Completed BWIP
Cost last month P276,400
Cost this month:
Materials: -0-
Labor: (23,400 x P1.92) 44,928
Overhead: (14,400 x P3.40) 48,960 93,888
Total costs of completed BWIP P370,288

14. (a)

Units completed:
From BWIP (#13) P 370,288
From SIP: (206,000 x P10.25) 2,111,500
Total costs of units completed P2,481,788

15. (a)

Total costs of units completed (#14) P2,481,788

Divided by total units completed ÷ 242,000
Average unit cost P 10.26
 5

16. (a)

Materials: (23,500 x P4.93) P115,855

Labor: (5,875 x P1.92) 11,280
Overhead: (7,050 x P3.40) 23,970
Total cost of EWIP P151,105

17. (b)

Equivalent Units of Production – Materials

Units completed:
From BWIP: (20 x 0%) 0
From SIP: (90 – 20) 100% 70 70
Ending work in process: (10 x 100%) 10
EUP 80

Unit material cost:

Material cost incurred this month P8,000,000
Divided by EUP ÷ 80
Unit material cost P 100,000

18. (a)

Equivalent Units of Production – Conversion Cost:

Units completed:
From BWIP: (20 x 40%) 8
From SIP 70 78
Ending work in process: (10 x 70%) 7
EUP 85

Unit conversion cost:

Conversion costs incurred this month P3,740,000
Divided by EUP ÷ 85
Unit conversion cost P 44,000

19. (a)

Cost incurred last month P2,280,000

Cost incurred this month:
Conversion costs: (8 x P44,000) 352,000
Total costs of completed BWIP P2,632,000

20. (a)

Transferred out:
From BWIP #(19) P 2,632,000
From SIP; (70 x P144,000) 10,080,000
Total cost of units completed P12,712,000
Divided by total units completed ÷ 90
Average unit cost P 144,244

21. (a) , See #20 above.

 6

22. (a)

Materials: (10 x P100,000) P1,000,000

Conversion cost: (7 x P44,000) 308,000
Cost of EWIP inventory P1,208,000

23. (a)

Equivalent Units of Production - Materials

Units completed:
From BWIP: (10,000 x 0%) 0
From SIP: (34,000 – 10,000) 100% 24,000 24,000
Ending work in process: (16,000 x 100%) 16,000
EUP – Materials 40,000

Unit material cost: (P280,000 / 40,000) P 7.00

24. (a)

Equivalent Units of Production – Conversion Costs:

Units completed:
From BWIP: (10,000 x 30%) 3,000
From SIP 24,000 27,000
Ending work in process: (16,000 x 50%) 8,000
EUP – Conversion costs 35,000

Unit conversion costs: (P371,000 / 35,000) P10.60

25. (d)

Cost last month P60,000

Cost added this month:
Material cost P -0-
Conversion costs: (3,000 x P10.60) 31,800 31,800
Total cost of competed BWIP P91,800

26. (b)

Units Transferred out:

From BWIP (#25) P 91,800
From SIP: (24,000 x P17.60) 422,400
Total costs of units transferred out P514,200
Divided by units transferred out ÷ 34,000
Average unit cost of units transferred out P 15.12

27. (a)

Material cost: (16,000 x P7) P112,000

Conversion costs: (8,000 x P10.60) 84,800
Total costs of EWIP inventory P196,800
 7

28. (a)

Transferred in costs this month P85,600

Divided by units transferred in this month ÷ 80
Unit transferred in cost P 1,070

29. (a)

Equivalent Units of Production:

Materials:
Competed and transferred out:
From BWIP: (40 x 100%) 40
From transferred in: (90 – 40) 100% 50 90
Ending work in process: (30 x 0%) 0
EUP 90

Conversion costs::
Completed and transferred out:
From BWIP: (40 x 25%) 10
From transferred in 50 60
Ending work in process: (30 x 50%) 15
EUP 75

Unit costs:
Materials: (P36,000 / 90) P400
Conversion costs: (49,725 / 75) P663

30. (a)

Units completed and transferred out:

From BWIP:
Cost last month P57.200
Cost added this month:
Materials: (40 x P400) 16,000
CC: (10 x P663) 6,630 P 79,830
From transferred in: (P1.070 + P400 + P663) x 50 106,650
Total costs of units completed and transferred out P186,480

Ending work in process:

Transferred in costs: (30 x P1,070) P 32,100
Costs added this department:
Conversion cost: (15 x P663) 9,945
Total costs of EWIP P 42,045

31. (d)

Equivalent Units of Production – Materials:

Units completed:
From BWIP (150 x 100%) 150
From Transferred In: (525 – 150) 375 525
Ending work in process (75 x 0%) 0
EUP – Materials 525
 8

No. 31 (continued)

Equivalent Units of production – Conversion Costs:

Units completed:
From BWIP: (150 x 30%) 45
From Transferred In 375 420
Ending work in process (75 x 60%) 45
EUP – CC 465

32. (a)

Material cost incurred this month P971,250

Divided by EUP ÷ 525
Unit material cost P 1,850

33. (a)

Conversion costs incurred this month P395,250

Divided by EUP ÷ 465
Unit conversion costs P 850

34. (a)

Cost last month P327,965

Cost this month:
Materials: (150 x 1,850) P277.500
Conversion costs: (45 x P850) 38,250 315,750
Total costs of completed BWIP P643,715

35. (a)

Transferred out to finished goods:

From BWIP ( #34) P 643,715
From Transferred In: (P1,770* + P1,850 + P850) x 375 1,676,250
Total cost of units transferred out to finished goods P2,319,965

* Unit transferred in cost: (P796,500 / 450) = P1,770

36. (a)

Transferred in costs from prior department: (75 x P1,770) P 132,750

Cost added in this department:
Conversion costs: (45 x P850) 38,250
Total costs of ending work in process P 171,000
37.

Transferred Direct Conversion

Equivalent Units of Production In Costs Materials Costs
Cost added in current month P234,000 P228,000 P228,800
Divided by cost per EUP ÷ P 26 ÷ P12 ÷ 20.80
EUP 9,000 19,000 11,000

Number 37 (continued):
 9

Transferred In costs:
Total EUP 9,000
Started and completed (19,000 - 15,000) (4,000)
EUP – Transferred in 5,000

Direct materials:
Total EUP 19,000
Transferred out
From BWIP (15,000 x 100%) 15,000
From started and completed 4,000 (19,000)
EUP – EWIP -0-

Conversion Costs:
Total EUP 11,000
Transferred out:
From BWIP (15,000 x 40%) 6,000
From started and completed 4,000 (10,000)
EUP – EWIP 1,000

Percentage of Completion:
Transferred in costs: (5,000 / 5,000) 100%
Direct materials: ( 0 / 5,000) 0%
Conversion costs: (1,000 / 5,000) 20%

38. (a)

Transferred out:
From BWIP:
Cost last month P 540,000
Cost added this month:
Materials (15,000 x P12) 180,000
CC: (6,000 x P20.80) 124,800
Total costs of BWIP 844,000
From started and completed (4,000 x P58.80) 235,200
Total costs of units transferred out P1,080,000

Ending Work In Process:

Transferred in costs from prior department (5,000 x P26) P 130,000
Cost added this department:
Conversion costs: (1,000 x P20.80) 20,800
Total costs of EWIP P 150,800

Solutions to Problems
 10

Problem 12-1

1. Equivalent Units of Production:

Materials:
Completed and transferred out:
From BWIP: (300 x 0%) -0-
From SIP: (2,000 – 300) 100% 1,700 1,700
Ending work in process: (500 x 100%) 500
EUP 2,200
Conversion Costs:
Completed and transferred out:
From BWIP: (300 x 60%) 180
From SIP 1,700 1,880
Ending work in process: (500 x 25%) 125
EUP 2,005

Unit Costs:
Materials: (P699,600 / 2,200) P318
Conversion costs: (P425,060 / 2005) 212
Total unit costs P530

Total costs – Forming Department:

BWIP P 96,250
Cost added during April:
Materials P699,600
Conversion costs 425,060 1,124,660
Total costs P1,035,410

Assignment of Costs:
Units completed and transferred out:
From BWIP:
Cost last month P96,250
Cost added this month:
CC: (180 x P212) 38,160 P 124,410
From SIP: (1,700 x P5.30) 901,000
Total costs completed and transferred out P1,035,410

Ending work in process:

Materials: (500 x P318) P 159,000
Conversion costs: (125 x P212) 26,500
Total costs of EWIP P 185,500

2. Work in process – Forming Department 1,124,660

Account payable (materials) 699,600
Various accounts (conversion costs) 425,060
To record direct materials and conversion costs incurred
And used in production during April.

Work in process – Finishing Department 1,035,410

Work in process – Forming Department 1,035,410
To record costs of units transferred to Finishing Department.
 11

Problem 12 -2

2. Equivalent Units of Production:

Materials:
Completed and transferred out:
From BWIP: (500 x 100%) 500
From SIP: (2,100 – 500) 100% 1,600 2,100
Ending work in process: (400 x 0%) -0–
EUP 2,100

Conversion costs:
Completed and transferred out:
From BWIP: (500 x 40%) 200
From SIP 1,600 1,800
Ending work in process: (400 x 30%) 120
EUP 1,920

Unit Costs:
Transferred in costs: (P1,035,410 / 2,000) P517.705
Materials costs: (P231,000 / 2,100) 110.00
Conversion costs: (P384,000 / 1,920) 200.00
Total unit costs P827.705

Total Costs – Finishing Department:

Work in process, April 1 P 247,700
Transferred In costs this month 1,035,410
Cost added this month:
Materials P231,000
Conversion costs 384,000 615,000
Total costs P1,898,110

Assignment of costs:
Units completed and transferred out:
From BWIP:
Cost last month P247,700
Cost added this month:
Materials: (500 x P110) 55,000
CC: (200 x 200) 40,000 P 342,700
From SIP: (1,600 x P827.705) 1,324,328
Total costs of units completed and transferred out P1,667,028

Ending Work in Process:

Transferred In costs: (400 x P517.705) P 207,082
Cost added: Conversion costs: (120 x P200) 24,000
Total costs of EWIP P 231,082

2. Work in process – Finishing Department 1,035,410

Work in process – Forming Department 1,035,410
To record transferred in costs from Forming Department.

Finished goods 1,667,028

Work in process – Finishing Department 1,667,028
To record cost units transferred out to finished goods.
 12

Problem 12-3

1. Equivalent Units of Production:

Materials:
Completed and transferred out:
From BWIP: (4,000 x 0%) -0-
From SIP: (50,000 – 4,000) 100% 46,000 46,000
Ending work in process: (6,000 x 100%) 6,000
EUP 52,000

Conversion Costs:
Completed and transferred out:
From BWIP: (4,000 x 40%) 1,600
From SIP 46,000 47,600
Ending work in process: (6,000 x 75%) 4,500
EUP 52,100

2. Cooking Department
Cost of Production Report
Month of July 2010

Quantity Schedule Units

Beginning work in process 4,000
Started in process 52,000
Units to account for 56,000

Completed and transferred out:

From BWIP 4,000
From SIP 46,000 50,000
Ending work in process 6,000
Total accounted for 56,000

Cost Schedule Total Cost EUP Unit Costs

BWIP P 84,448
Cost added this month:
Materials 595,920 ÷ 52,000 = P11.46
Conversion costs 860,692 ÷ 52,100 = 16.52
Total costs to account for P1,541,060 P27.98

Completed and transferred Out:

From BWIP:
Cost last month P 84,448
Cost added this month:
Conversion costs 26,000 = 1,600 x P16.52
Total BWIP 110,880
From SIP 1,287,080 = 4,600 x 27.98
Total costs transferred out P1,297,960

Ending work in process:

Materials P 68,760 = 6,000 x 11.46
Conversion costs 74,340 = 4,500 x 16.52
Total EWIP 143,100
Total costs accounted for P1,541,060
 13

Problem 12-4

1. Equivalent Units of Production:

Materials:
Transferred out:
From BWIP: (8,000 x 20%) 1,600
From SIP: (44,000 – 8,000) 36,000 37,600
Ending work in process: (4,000 x 70%) 2,800
EUP 40,400

Labor:
Transferred out:
From BWIP: (8,000 c 60%) 4,800
From SIP 36,000 40,800
Ending work in process: (4,000 x 50%) 2,000
EUP 42,800

Overhead:
Transferred out:
From BWIP: (8,000 x 70%) 5,600
From SIP 36,000 41,600
Ending work in process: (4,000 x 40%) 1,600
EUP 43,200

2. Curing Department
Cost of Production Report
Month of May 2010

Quantity Schedule Units

Beginning work in process 8,000
Transferred In from prior department 40,000
Units to account for 48,000

Transferred out:
From BWIP 8,000
From Transferred In 36,000 44,000
Ending work in process 4,000
Total accounted for 48,000
 14

Problem 12-4 (continued)

Cost Schedule Total Costs EUP Unit Costs

Beginning work in process P 202,520
Transferred In cost - current month 640,000 ÷ 40,000 = P16.00
Cost added this department:
Materials 323,200 ÷ 40,400 = 8.00
Labor 171,200 ÷ 42,800 = 4.00
Overhead 86,400 ÷ 43,200 = 2.00
Total costs to account for P1,423,320 P30.00

Costs accounted for as follows:

Transferred out:
From BWIP:
Cost last month P 202,520
Cost added this month:
Materials 12,800 = 1,600 x P 8.00
Labor 19,200 = 4,800 x 4.00
Overhead 11,200 = 5,600 x 2.00
Total BWIP 245,720
From Transferred In 1,080,000 = 36,000 x 30.00
Total costs transferred out 1,325,720

Ending Work in process:

Transferred in costs 64,000 = 4,000 x 16.00
Cost added:
Materials 22,400 = 2,800 x 8.00
Labor 8,000 = 2,000 x 4.00
Overhead 3,200 = 1,600 x 2.00
Total EWIP 97,600
Total costs accounted for P1,423,320

Problem 12-5
 15

1. Equivalent Units of Production:

Materials:
Transferred out to finished goods:
From BWIP: (1,000 x 10%) 100
From SIP: (2,800 – 1,000) 100% 1,800 1,900
Ending work in process: (1,200 x 50%) 600
EUP 2,500

Conversion costs:
Transferred out to finished goods:
From BWIP: (1,000 x 20%) 200
From SIP 1,800 2,000
Ending work in process: (1,200 x 40%) 480
EUP 2,480

2. Assembly Department:
Cost of Production Report
Month of November 2010

Quantity Schedule Units

Beginning work in process 1,000
Started in process 3,000
Total to be accounted for 4,000

Transferred out to finished goods:

From BWIP 1,000
From SIP 1,800 2,800
Ending work in process 1,200
Total accounted for 4,000

Cost Schedule Total Costs EUP Unit Costs

Beginning work in process P 397,000
Costs from prior department 292,500 ÷ 3,000 = P 97.50
Costs added this department:
Materials 133,750 ÷ 2,500 = 53.50
Conversion costs 262,880 ÷ 2,480 = 106.00
Total to accounted for P1,086,130 P257.00
Transferred out to finished goods:
From BWIP:
Cost last month P 397,000
Current costs:
Materials 5,350 = 100 x 53.50
CC 21,200 = 200 x 106.00
Total BWIP 423,550
From SIP 462,600 = 1,800 x 257.00
Total costs transferred out P 886,150
Ending work in process:
Cost from prior department 117,000 = 1,200 x 97.50
Cost added this department:
Materials 32,100 = 600 x 53.50
Conversion cost 50,880 = 480 x 106.00
Total BWIP 199,980
Total accounted for P1,086,130
Problem 12-6
 16

1. Equivalent Units of Production:

Department 1 Department 2
Materials:
Transferred out:
From BWIP: -0- -0-
From SIP 40,000 36,000
Ending work in process 10,000 (100%) 9,000 (100%)
EUP 50,000 45,000
Conversion costs:
Transferred out:
From BWIP 1,750 (35%) 4,200 (60%)
From WIP 40,000 36,000
Ending work in process 7,500 (75%) 4,500 (50%)
EUP 49,250 44,700

2. Department 1
Cost of Production Report
For the Month of May 2010

Quantity Schedule Units

Beginning work in process 5,000
Started in process 50,000
Total to account for 55,000

Transferred out to Department 2:

From BWIP 5,000
From SIP 40,000
Ending work in process 10,000
Total accounted for 55,000

Cost Schedule Total Costs EUP Unit Costs

Beginning work in process P 32,475
Cost added this month:
Direct materials 65,000 ÷ 50,000 = P1.30
Conversion costs 142,825 ÷ 49,250 = 2.90
Total to account for P240,300 P4.20

Costs accounted for as follows:

Transferred out to Department2:
From BWIP:
Cost last month P 32,475
Cost added:
CC 5,075 = 1,750 x P2.90
Total BWIP 37,550
From SIP 168,000 = 40,000 x 4.20
Total costs transferred out 205,550

Ending work in process:

Materials 13,000 = 10,000 x 1.30
Conversion costs 21,750 = 7,500 x 2.90
Total costs of BWIP 34,750
Total accounted for P240,300

Problem 12-6 (continued)

 17

Department 2
Cost of Production Report
Month of May 2010

Quantity Schedule Units

Beginning work in process 7,000
Transferred In from prior department 45,000
Total to account for 52,000

Transferred out to finished goods:

From BWIP 7,000
From TI 36,000 43,000
Ending work in process 9,000
Total accounted for 52,000

Cost Schedule Total costs EUP Unit Costs

Beginning work in process P 65,560
Cost from prior department 205,550 ÷ 45,000 = P4.56778
Cost added this department:
Direct materials 45,000 ÷ 45,000 = 1.00
Conversion costs 109,962 ÷ 44,700 = 2.46
Total to account for P426,072 P8.02778

Cost accounted for:

Transferred out to finished goods:
From BWIP:
Cost last month P 65,560
Cost added this month:
CC 10,332 = 4,200 x P2.46
Total BWIP 75,892
From transferred in 289,000 = 36,000 x 8.02778
Total costs transferred to FG P364,892

Ending work in process:

Transferred In P 41,110 = 9,000 x 4.56778
Cost added:
Materials 9,000 = 9,000 x 1.00
Conversion costs 11,070 = 4,500 x 2.46
Total EWIP 61,180
Total accounted for P426,072

Problem 12-7
 18

1. Equivalent Units of Production:

Cutting Department Units Materials Conversion

Beginning WIP 1,300
Started in process 4,800
Total to account for 6,100

Transferred Out:
From BWIP 1,200 260 325
From SIP 3,700 3,700 3,700
Ending WIP 1,100 440 220
EUP 6,100 4,400 4,245

Coating Department Units Materials Conversion

Beginning WIP 900
Started in process 5,000
Total to account for 5,900

Transferred out:
From BWIP 900 900 360
From SIP 3,600 3,600 3,600
Ending WIP 1,400 -0- 560
EUP 5,900 4,500 4,520

2. Cost per equivalent unit:

Cutting Department Material Conversion

Current costs P35,200 P25,470
Divided by EUP ÷ 4,400 ÷ 4,245
Unit costs P 8 P 5

3. Cost transferred out and EWIP inventory of Cutting Department:

Cost of BWIP P16,065

Cost to complete BWIP:
Material: (260 x P8) P 2,080
Conversion: (325 x P5) 1,625
Started and completed : (3,700 x P13) 48,100 51,805
Total costs transferred out P67,870

Ending WIP:
Materials: (440 x P8) P3,520
Conversion costs: (220 x P5) 1,100 4,620
Total costs P72,490

Problem 12-7 (continued)

 19

4. Coating Department Transferred In Material Conversion

Current costs P67,870 P4,950 P11,300
Divided by EUP ÷ 5,000 ÷4,500 ÷ 4,520
Unit cost P13.574 P 1.10 P 2.50

Cost Assignment:

Transferred out:
From BWIP:
Cost last month P13,514
Cost added this month:
Material: (900 x P1.10) 990
Conversion: (360 x P2.50) 900 P15,404
From SIP: (3,600 x P17.17) 61,812
Total cost transferred out P77,216

Ending WIP:
Transferred in: (1,400 x P13.574) P19,004
Conversion cost: (560 x P2.50) 1,400 20,404
Total costs accounted for P97,620

5. Since there was no beginning or ending FG inventory, cost of goods sold is equal to
cost of goods manufactured (transferred out to FG) for the period. Thus COGS =
P77,216

Problem 12-8
 20

1. Equivalent Units of Production – Molding Department:

Materials:
Transferred out:
From BWIP: (700 x 0%) -0-
From SIP: 3,400 3,400
Ending WIP: (500 x 100%) 500
EUP 3,900

Labor:
Transferred out:
From BWIP: (700 x 45%) 315
From SIP 3,400 3,715
Ending WIP: (500 x 60%) 300
EUP 4,015

Overhead:
Transferred out:
From BWIP: (700 x 30%) 210
From SIP: 3,400 3,610
Ending WIP: (500 x 75%) 375
EUP 3,985

2. Equivalent Units of Production – Finishing Department:

Materials:
Transferred Out:
From BWIP: (420 x 50%) 210
From SIP 3,720 3,930
Ending WIP: (380 x 25%) 95
EUP 4,025

Labor:
Transferred Out:
From BWIP: (420 x 60%) 252
From SIP 3,720 3,972
Ending WIP: (380 x 25%) 95
EUP 4,067

Overhead:
Transferred Out:
From BWIP: (420 x 60%) 252
From SIP 3,720 3,972
Ending WIP: (380 x 25%) 95
EUP 4,067

Problem 12-8 (continued)

 21

2. Molding Department:
Cost of Production Report
Month of June 2010

Quantity Schedule Units

Beginning WIP 700
Started in process 3,900
Total to account for 4,600

Transferred out:
From BWIP 700
From SIP 3,400 4,100
Ending WIP 500
Total accounted for 4,600

Cost Schedule Total Costs EUP Unit Costs

Beginning WIP P11,918.20
Costs added in current month:
Materials 36,660.00 ÷ 3,900 = P 9.40
Labor 24,090.00 ÷ 4,015 = 6.00
Overhead 26,221.30 ÷ 3,985 = 6.58
Total cost to account for P98,889.50 P21.98

Transferred out:
From BWIP:
Cost in BWIP P11,918.20
Cost added in current month:
Labor 1,890.00 = 315 x P 6.00
Overhead 1,381.80 = 210 x 6.58
Total BWIP 15,190.00
From SIP 74,732.00 = 3,400 x 21.98
Total cost transferred out P89,922.00

Ending WIP
Materials 4,700.00 = 500 x 9.40
Labor 1,800.00 = 300 x 6.00
Overhead 2,467.50 = 375 x 6.58
Total Ending WIP 8,967.50
Total accounted for P98,889.50

4. Finishing Department
 22

Cost of Production Report

Month of June 2010

Quantity Schedule Units

Beginning WIP 420
Transferred In from prior department 4,100
Total to account for 4,520

Transferred Out:
From BWIP 420
From TI 3,720 4,140
Ending WIP 380
Total accounted for 4,520

Cost Schedule Total Costs EUP Unit Costs

Beginning WIP P 10,232.04
Transferred In costs this month 89,922.00 ÷ 4,100 = P21.93220
Cost added this month:
Material 4,025.00 ÷ 4,025 = 1.00
Labor 16,186.66 ÷ 4,067 = 3.98
Overhead 8,050.00 ÷ 4,067 = 1.97935
Total to account for P128,415.70 P28.89155

Transferred Out:
From BWIP:
Cost of BWIP P 10,232.04
Cost added in current month:
Material 210.00 = 210 x P 1.00
Labor 1,002.96 = 252 x 3.98
Overhead 498.80 = 252 x 1.97935
Total cost of BWIP 11,943.80
From Transferred In 107,476.57 = 3,720 x 28.89155
Total costs transferred to FG P119,420.32*

Ending WIP:
Transferred In P 8,334.24 = 380 x 21.93220
Cost added:
Material 95.00 = 95 x 1.00
Labor 378.10 = 95 x 3.98
Overhead 188.04 = 95 x 1.97935
Total cost of EWIP 8,995.38
Total accounted for P 128,415.70

*P5 difference due to rounding off

Problem 12-8 (continued)

 23

5. Work in process – Finishing Department 89,922.00

Work in process – Molding Department 89,922.00
To record cost of units transferred out from
Molding Department to Finishing Department.

Finished Goods Inventory 119,420.22

Work in process – Finishing Department 119,420.22
To record cost of finished goods.