Process Costing - Average 3. Overland, Inc.

, uses the weighted-average

1. The Assembly Department started the method in its process costing system. The
month with 59,000 units in its beginning work company's work in process inventory on April
in process inventory. An additional 274,000 30 consists of 25,000 units. The units in the
units were transferred in from the prior ending inventory are 100% complete with
department during the month to begin respect to materials and 75% complete with
processing in the Assembly Department. There respect to conversion costs. If the cost per
were 21,000 units in the ending work in process equivalent unit is P3.00 for materials and P5.50
inventory of the Assembly Department. How for conversion costs, the total cost in the April
many units were transferred to the next 30 work in process inventory is:
processing department during the month?
a. P109,375
a. 236,000 b. P212,500
b. 333,000 c. P178,125
c. 354,000 d. P159,375
d. 312,000
4. In July, one of the processing departments
2. Guasson Corporation uses the weighted- at Feickert Corporation had beginning work in
average method in its process costing system. process inventory of P23,000 and ending work
This month, the beginning inventory in the first in process inventory of P16,000. During the
processing department consisted of 500 units. month, P268,000 of costs were added to
The costs and percentage completion of these production and the cost of units transferred out
units in beginning inventory were: from the department was P275,000. In the
department's cost reconciliation report for July,
Cost Percent complete the total cost to be accounted for would be:
Materials 8,400 65%
a. P291,000
Conversion 13,700 55%
b. P559,000
A total of 6,400 units were started and 5,800 units c. P39,000
were transferred to the second processing d. P582,000
department during the month. The following costs
were incurred in the first processing department 5. Black Company uses the weighted-average
during the month: method in its process costing system. The
company's ending work in process inventory
Materials cost 142,100 consists of 5,000 units, 80% complete with
respect to materials and 50% complete with
Conversion Costs 271,000
respect to labor and overhead. If the total peso
The ending inventory was 85% complete with value of the inventory is P60,000 and the cost
respect to materials and 50% complete with per equivalent unit for labor and overhead is
respect to conversion costs. P8.00, the cost per equivalent unit for materials
must be:
The total cost transferred from the first processing
department to the next processing department a. P5.00
during the month is closest to: b. P4.00
c. P10.00
a. P435,200 d. P8.00
b. P463,549
c. P389,650 6. The "costs accounted for" portion of the
d. P413,100 cost reconciliation report includes the cost of
 beginning work in process inventory and the
cost of ending work in process inventory. 9. In September, one of the processing
departments at Shenkel Corporation had
a. True beginning work in process inventory of P25,000
b. False and ending work in process inventory of
P18,000. During the month, the cost of units
7. Lucas Company uses the weighted- transferred out from the department was
average method in its process costing system. P304,000. In the department's cost
The company adds materials at the beginning of reconciliation report for September, the total
the process in the Forming Department, which cost accounted for would be:
is the first of two stages in its production
process. Information concerning operations in c. P347,000
the Forming Department in October follows: d. P329,000
e. P322,000
Units Materials Cost f. P304,000
Work in process, Oct. 1 6,000 3,000
10. Assume there was no beginning work in
Units Started During October 50,000 25,560 process inventory and the ending work in
Units Completed and process inventory is 70% complete with respect
transferred to the next 44,000 to conversion costs. Under the weighted-
department during October average method, the number of equivalent
units of production with respect to conversion
What was the materials cost of work in process at costs would be:
October 31?
a. less than the units started during the
period
a. 3,060 b. the same as the units started during
b. 6,120 the period
c. 6,000 c. less than the units completed
d. 5,520 d. the same as the units completed
8. The Morgan Company uses the weighted- 11. The Richmond Company uses the
average method in its process costing system. weighted-average method in its process costing
For a particular department, the company had system. The company has only a single
54,000 equivalent units with respect to processing department. The company's ending
conversion costs in March. There were 7,500 work in process inventory on August 31
units in the department's beginning work in consisted of 18,000 units. The units in the
process inventory, two thirds complete with ending work in process inventory were 100%
respect to conversion costs. During March, complete with respect to materials and 60%
52,500 units were started and 50,000 were complete with respect to labor and overhead. If
completed and transferred out of the the cost per equivalent unit for August was
department. The ending work in process P2.75 for materials and P4.25 for labor and
inventory in the department: overhead, the total cost assigned to the ending
work in process inventory was:
a. consisted of 2,500 units
b. was 40% complete with respect to a. 80,100
conversion costs b. 126,000
c. was 65% complete with respect to c. 75,600
conversion costs d. 95,400
d. consisted of 5,000 units
 12. Fauste Corporation uses the weighted- The total cost transferred from the first processing
average method in its process costing system. department to the next processing department
The Assembly Department started the month during the month is closest to
with 10,000 units in its beginning work in
process inventory that were 70% complete with a. P242,055
respect to conversion costs. An additional b. P324,456
55,000 units were started during the month to c. P265,800
begin processing in the Assembly Department. d. 251,700
During the month 52,000 units were completed
in the Assembly Department and transferred to 14. Hanson Company uses the weighted-
the next processing department. There were average method in its process costing system.
13,000 units in the ending work in process The first processing department, the Welding
inventory of the Assembly Department that Department, started the month with 17,000
were 80% complete with respect to conversion units in its beginning work in process inventory
costs. that were 60% complete with respect to
What were the equivalent units for conversion conversion costs. The conversion cost in this
costs in the Assembly Department for the beginning work in process inventory was
month? $90,780. An additional 84,000 units were
started into production during the month and
a. 62,400 82,000 units were completed in the Welding
b. 55,400 Department and transferred to the next
c. 52,000 processing department. There were 19,000
d. 58,000 units in the ending work in process inventory of
the Welding Department that were 40%
13. Ermoin Corporation uses the weighted- complete with respect to conversion costs. A
average method in its process costing system. total of $690,780 in conversion costs were
This month, the beginning inventory in the first incurred in the department during the month.
processing department consisted of 600 units. The cost per equivalent unit for conversion
The costs and percentage completion of these costs is closest to:
units in beginning inventory were:
a. 6.707
b. 8.900
Cost Percent complete
c. 8.224
Materials 3,900 65% d. 8.723
Conversion 10,200 35%
15. Dewey Company uses the weighted-
A total of 5,700 units were started and 4,700 units average method in its process costing system.
were transferred to the second processing The first processing department, the Welding
department during the month. The following costs Department, started the month with 15,000
were incurred in the first processing department units in its beginning work in process inventory
during the month: that were 20% complete with respect to
Materials cost 44,800 conversion costs. The conversion cost in this
Conversion Costs 206,900 beginning work in process inventory was
$19,200. An additional 86,000 units were
The ending inventory was 75% complete with started into production during the month.
respect to materials and 20% complete with There were 13,000 units in the ending work in
respect to conversion costs. process inventory of the Welding Department
that were 60% complete with respect to
conversion costs. A total of $575,360 in
conversion costs were incurred in the
department during the month.
The cost per equivalent unit for conversion
costs is closest to:

a. 6.206
b. 6.690
c. 6.400
d. 5.812
Process Costing - FIFO a. True
b. False
1. When comparing the FIFO with the
weighted-average method, the FIFO method 9. Which formula gives FIFO equivalent unit
provides current cost information. production? (UC = units completed, BI =
equivalent units in beginning inventory, EI =
a. True
equivalent units in ending inventory)
b. False
a. UC + EI.
2. The FIFO method is easier to understand b. UC + EI - BI.
and use than the weighted-average method. c. UC + BI - EI.
d. UC + BI + EI.
c. True
d. False 10. Equivalent production calculated using
FIFO is higher than equivalent production
3. Total units to be accounted for less units in
calculated using weighted average.
beginning work in process equals

a. units transferred out. a. True

b. total units accounted for. b. False
c. equivalent units.
11. Chicotti Company has 3,000 units in
d. units started into production.
beginning work in process, 30% complete as to
4. There are no units in ending work in conversion costs, 25,000 units transferred out
process at the end of the period under the FIFO to finished goods, and 1,000 units in ending
method. work in process 20% complete as to conversion
costs. The beginning and ending inventory is
a. True fully complete as to materials costs. How much
b. False are equivalent units for materials if the FIFO
method is used?
5. Under the FIFO method, it is assumed that
the beginning work in process is completed a. 29,000
before new work is started. b. 25,200
c. 26,000
a. True d. 23,000
b. False
12. The Wrapping Department’s output
during the period consists of 10,000 units
6. The FIFO method is conceptually superior completed and transferred out, and 600 units in
to the weighted-average method. ending work in process that were 75% complete
a. True as to materials and conversion costs. Beginning
b. False inventory was 800 units that were 30%
complete as to materials and conversion costs.
7. If a company has no inventories, the Under the FIFO method, what are the
weighted-average approach and the FIFO equivalent units of production for materials?
approach will result in the same income.
a. 10,690
a. True b. 11,010
b. False c. 10,450
d. 10,210
8. Although weighted average and FIFO may
give different values for inventory, the resulting 13. Granger Co. had P3,000 in beginning work
income will always be the same. in process and incurred an additional P28,500
 during the period. If FIFO EUP was 10,000 units, c. 25,000
unit cost would be d. 26,400

a. P9.50. 17. The Cutting Department’s output during

b. some other number. the period consists of 12,000 units completed
c. P2.85. and transferred out, and 3,000 units in ending
d. P3.15. work in process that were 25% complete as to
materials and conversion costs. Beginning
inventory was 1,500 units that were 25%
14. Hanker Company had the following complete as to materials and conversion costs.
department data on physical units: Under the FIFO method, what are the
Work in process, beginning 1,000 equivalent units of production for materials?

a. 13,500
Completed and transferred out 4,000
b. 13,725
Work in process, ending 800 c. 12,375
d. 14,475
Materials are added at the beginning of the
process. What is the total number of equivalent 18. Cheatem has a weighted-average EUP of
units for materials if the FIFO method is used? 30,000 units. Beginning inventory was 4,000
units 40% complete; ending inventory was
a. 4,200
5,000 units 60% complete. FIFO EUP is
b. 3,800
c. 3,000
a. 31,000.
d. 4,800
b. 25,400.
15. Garden Co. had a beginning inventory of c. 28,400.
3,000 units 60% complete, ending inventory of d. 30,000.
3,000 units 80% complete, and transferred out
27,500 units. FIFO unit costs were P2.15 for
19. Schiller Company has unit costs of P5 for
materials, P1.25 for conversion costs. All
materials and P15 for conversion costs. There
materials are added at the start of the process.
are 4,200 units in ending work in process which
Beginning inventory cost P9,400. The cost of
are 25% complete as to conversion costs, and
ending inventory is
fully complete as to materials cost. How much
a. P17,000. is the total cost assignable to the ending work
b. P9,450. in process inventory if the FIFO method is used?
c. P10,200.
a. 36,750
d. P8,160.
b. 21,000
c. 84,000
16. Solis Company uses the FIFO method to
d. 15,750
compute equivalent units. It has 2,000 units in
beginning work in process, 20% complete as to
conversion costs and 50% complete as to 20. Special Company had the following
materials costs, 25,000 units started, and 3,000 department information about physical units
units in ending work in process, 30% complete and percentage of completion:
as to conversion costs, and 80% complete as to
materials cost. How much are the equivalent Physical Units
units for materials under the FIFO method?
Work in process, May 1 (60%) 14,400
a. 27,000 Completed and transferred out 26,000
b. 25,400
Work in process, May 31 (50%) 12,000

Materials are added at the beginning of the

production process. Conversion costs are added
equally throughout production. What is the total
number of equivalent units during May for
conversion costs if the FIFO method is used?

a. 23,360
b. 43,760
c. 52,400
d. 32,000