CHAPTER 11
Answers to Multiple Choice – Theoretical
1. b 5. C 9. c
2. d 6. C 10. A
3. d 7. D 11. A
4. b 8. D 12. B
Solutions to Multiple Choice – Computational
1. (c)
Materials:
Units transferred out (100%) 255,000
Units in process, April 30 (100%) 25,000
EUP 280,000
Conversion Costs:
Units transferred out (100%) 255,000
Units in process, April: (25,000 x 60%) 15,000
EUP 270,000
2. (b)
Equivalent Units of Production: Materials:
Units completed and transferred out (100%) 85,000
Units in process, end (100%) 14,000
EUP 99,000
Unit cost – Materials:
Cost last month (BWIP) P12,800
Cost this month (current cost) 69,700
Total P82,500
Divided by EUP ÷ 99,000
Unit cost P 0.833
3. (b)
Equivalent Units of Production – Materials
Units completed and transferred out (100%) 44,000
Units in process, July 31 (100%) 12,000
EUP 56,000
Unit cost – Materials:
Cost last month (BWIP) P 3,000
Cost this month 25,560
Total P28,560
Divided by EUP ÷ 56,000
Unit cost P 0.51
4. (b)
Transferred in costs (4,000 x P50 P200,000
Conversion costs: (4,000 x 40%) x P30 48,000
Cost of work in process, March 31 P248,000
5. (a)
Units completed (100%) 20,000
Units in process, end: (8,000 x 75%) 6,000
EUP – conversion costs 26,000
6. (a)
Equivalent units of production: Materials:
Units completed and transferred out (100%) 12,000 Units in process, May 31: (100%) 8,000
EUP 20,000
Conversion costs:
Units completed and transferred out (100%) 12,000 Units in process, May 31: (8,000 75%) 6,000
EUP 18,000
Unit costs:
Transferred in cost:
Work in process, May1 (6,000 units) P12,000
Current cost (14,000 units) 29,000
Total P41,000 Divided by ÷20,000 Unit cost P 2.05 Cost added: Materials: BWIP P2,500 Current cost 5,500 Total P8,000 EUP ÷20,000 0.40 Conversion costs: BWIP P1,300 Current cost 5,000 Total P6,300 EUP ÷18,000 0.35
Total unit costs P 2.80
7. (d)
Equivalent production for labor:
Units transferred out to next department 7,200
Units in process, end; (1,400 x 30%) 420
EUP 7,620
Unit cost for labor:
BWIP P 2,880
Current cost 91,227
Total P94,107
Divided by EUP ÷ 7,620
Unit cost P 12.35
Units transferred out: (7,200 x P12.35) P88,920
8. (b)
Work in process, end: (420 x P12.35) P 5,187
9. (a)
Equivalent production for materials:
Units transferred out (100%) 6,700
Units in process, end (300 x60%) 180
EUP 6,880
Material unit cost:
BWIP P10,000
Current cost 63,272
Total material cost P73,272
Divided by EUP ÷ 6,880
Unit cost P 10.65
Units transferred out: (6,700 x P10.65) P71,335 Units in process, end: (180 x P10.65) P 1,917 10. (a)
Direct materials:
Units completed (100%) 460
Units in process, May 31: (120x 60%) 72
EUP 532
Conversion costs:
Units completed (100%) 460
Units in process, May 31: (120 x 30%) 36
11. (a)
Unit costs: Materials:
Work in process, May 1 P 49,336
Current cost 322,000
Total material cost P 371,336
EUP (per #10) ÷ 532
Unit cost P 698
Conversion costs:
Work in process, May 1 P 9,104
Current cost 139,200
Total conversion costs P 148,304
EUP (per #10) ÷ 496
Unit cost P 299
Total unit cost P 997
Units completed: (460 x P997) P458,620
Units in process, end:
Materials: (72 x P698) P 50,256
Conversion cost: (36 x P299) 10,764
Total work in process P 61,020
12. (a)
Equivalent Units of Production: Direct materials:
Units completed 34,000
Units in process, July 31: (16,000 x100%) 16,000
EUP 50,000
Conversion costs:
Units completed 34,000
Units in process, July 31: (16,000 x 50%) 8,000
EUP 42,000
Unit Costs: Materials:
Work in process, July 1 P 60,000
Current costs 280,000
Total material costs P340,000
EUP ÷ 50,000
Unit material cost P 6.8
Conversion costs:
Work in process, July 1 P 70,000
Current costs 371,000
Total conversion costs P441,000
EUP ÷ 42,000
13. (a)
Units completed: (34,000 x P17.30) P588,200 Units in process, end:
Materials: (16,000 x P6.8) P108,800
Conversion costs: (8,000 x P10.5) 84,000
Total work in process P192,800
14. (a)
Equivalent Units of Production: Materials:
Units completed and transferred out 90
Units in process, June 30 0
EUP 90
Conversion costs:
Units completed and transferred out 90
Units in process, June 30: (30 x 50%) 15
EUP 105
Unit Costs: Transferred In:
Work in process, June 1 P 40,000
Current costs 87,200
Total P127,200
EUP: (40 + 80) ÷ 120
Unit cost P 1,060
Direct materials:
Work in process, June 1 P 0
Current cost 36,000
Total 36,000
EUP ÷ 90
Unit cost P 400
Conversion costs:
Work in process, June 1 P 18,000
Current cost 49,725
Total P 67,725
EUP ÷ 105
Unit cost P 645
Total unit costs P 2,105
15. (d)
Units completed: (90 x P2,105) P189,450
Units in ending WIP:
Transferred in cost; (30 x P1,060) P 31,800
Costs added: CC (15 x P645) 9,675
16. (a)
Equivalent Units of Production: Materials:
Units completed 90
Work in process, July 31 (100%) 10
EUP 100
Conversion costs:
Units completed 90
Work in process, July 31 (70%) 7
EUP 97
Unit Costs: Materials:
BWIP P1,800,000
Current costs 8,000,000
Total material cost P9,800,000
EUP ÷ 100
Unit material cost P 98,000
Conversion costs:
BWIP P 479,500
Current cost 3,740,000
Total conversion costs P4,219,500
EUP ÷ 97
Unit conversion costs P 43,500
Total unit costs P 141.500
17. (a)
Units completed: (90 x P141,500) P12,735,000
Units in process, ending:
Materials: (10 x P98,000) P 980,000
Conversion costs: (7 x P43,500) 304,500
Total work in process, ending P 1,284,500
18. (a)
Department X:
Units in process, May 1 500
Units started in process 15,000
Total units to account for 15,500
Units completed (10,500)
Units still in process 5,000
Department Y:
Units in process, May 1 300
Transferred in from Department X 8,000
Total units to account for 8,300
Units completed (7,000)
19. (a)
Equivalent Units of Production: Materials:
Transferred out 50,000
Work in process, June 30 20,000
EUP 70,000
Conversion Costs:
Transferred out 50,000
Work in process, June 30: (40% x 20,000) 8,000
EUP 58,000 Units Costs: Materials: BWIP P 187,500 Current cost 1,212,500 Total P1,400,000 EUP ÷ 70,000
Unit material cost P 20.00
Labor cost:
BWIP P 53,750
Current cost 816,250
Total P 870,000
EUP ÷ 58,000
Unit conversion cost P 15.00
Overhead: (P15 x 70%) P 10.50
Total unit costs P 45.50
20. (a)
Cost of goods manufactured: (50,000 x P45.50) P2,275,000
Less: Finished goods inventory, June 30 72,500
Cost of goods sold P2,202,500
21. (b)
Department 1 Department 2
Work in process, June 1 34,000 33,000
Started in process/transferred in 117,000 132,500
Total units to account for 151,000 165,500
Transferred out (132,500) ( 131,200)
Units still process, June 30 18,500 34,300 22. (b)
Materials Conversion Costs
Units transferred out 131,200 131,200
Ending work in process 34,200 (100%) 25,725 (75%)
23. (d)
Beginning work in process P23,000
Materials added 29,000
Conversion costs added 36,000
Total cost of units placed in process 88,000
Less: Ending work in process 19,000
Cost of units transferred out to finished goods P69,000 24. (d)
Equivalent Units of Production: Materials:
Transferred out 8,000
Ending work in process: (10,000 – 8,000) 100% 2,000
EUP 10,000
Conversion costs:
Transferred out 8,000
Ending work in process: (2,000 x 70%) 1,400
EUP 9,400
Unit costs:
Materials: (P15,000 / 10,000) P1.50
Conversion costs: (P24,440 / 9,400) 2.60
Total unit costs P4.10
Costs of units transferred out to next dept.: (8,000 x P4.10) P32,800 25. (d)
Materials: (2,000 x P1.50) P3,000
Conversion costs: (1,400 x P2.60) 3,640
Total work in process P6,640
26. (a)
Equivalent Units of Production Materials CC
Transferred out 85,000 85,000
Ending work in process 5,000 (100%) 3,000 (60%)
EUP 90,000 88,000
Unit Costs Materials CC
Beginning work in process P 30,000 P 16,000
Current costs 88,000 50,000 Total costs P118,000 P 66,000 EUP ÷ 90,000 ÷ 88,000 Unit costs P 1.31 P 0.75 Transferred Out: Materials: (85,000 x P1.31) P111,350 Conversion costs: (85,000 x P0.75) 63,750 27. (d) (10,000 + 80,000)
28. (c)
Equivalent Units of Production Materials CC
Completed production 184,000 184,000
Ending work in process 1 43,200 (90%) 9,200 (40%)
EUP 227,200 203,200
Unit Costs Materials CC
Beginning work in process P 54,560 P 35,560
Current costs 468,000 574,040
Total costs P522,560 P609,600
EUP ÷227,200 ÷203,200
Unit costs P 2.3 P 3.00
29. (d)
Ending work in process:
Materials: (43,200 x P2.3) P 99,360
Conversion costs: (19,200 x P3.0) 57,600
Total costs of EWIP P156,960
30. (c)
Equivalent Units of Production Materials CC
Completed and transferred out 92,000 92,000 Ending work in process 21,600 (90%) 9,600 (40%)
EUP 113,600 101,600
Unit Costs Materials CC
Beginning work in process P 54,560 P 35,560
Current costs 468,000 574,040 Total costs P522,560 P 609,600 EUP ÷113,600 ÷ 101,600 Unit costs P 4.60 P 6.00 31. (d) Materials: (21,600 x P4.60) P 99,360 Conversion costs: (9,600) x P6.00) 57,600
Cost of ending work in process P156,960
32. (a)
Beginning work in process P 2,047
Costs transferred in – this month 8,483
Total costs transferred in P10,530
EUP: (8,900 + 30,100) ÷39,000
33. (a)
Equivalent Units of Production: Materials:
Units transferred out 29,000
Ending work in process (100%) 10,000
EUP 39,000
Unit material cost:
BWIP P 267
Current costs 1,683
Total material cost P 2,950
EUP ÷ 39,000
Unit material cost P 0.05
34. (b)
Equivalent Units of Production: Direct labor:
Units transferred out 29,000
Ending work in process (10,000 x 75%) 7,500
EUP 36,500
Direct labor unit cost:
BWIP P1,495.20
Current costs 7,994.80
Total conversion costs P9,490.00
EUP ÷ 36,000
Direct labor unit cost P 0.26
35. (a)
BWIP P 534.00
Current costs, November 2,021.00
Total overhead costs P2,555.00
EUP (same as labor) ÷ 36,000
Solutions to Problems
Problem 11-1
1. Equivalent Units of Production: Materials:
Units transferred out 73,000
Units in process, end: (100%) 12,000
EUP 85,000
Conversion costs:
Units transferred out 73,000
Units in process, end: (12,000 x 2/3) 8,000
EUP 81,000
2. Refining Department Cost of Production Report Month of January, 2010
Quantity Schedule Units
Beginning work in process 10,000
Started in process 75,000
Units to account for 85.000
Transferred out 73,000
Ending work in process (100%) 12,000 Total units accounted for 85,000
Cost Schedule Total Cost EUP Unit Cost
Materials: BWIP P 64,000 Current cost 616,000 Total 680,000 ÷ 85,000 = P 8.00 Conversion costs: BWIP 39,900 Current cost 400,720 Total costs 440,620 ÷ 81,000 = 5.44
Total costs to account for 1,120,620 P13.44
Transferred out 981,120 = 73,000 x P13.44 Ending work in process:
Materials 96,000 = 12,000 x 8.00 Conversion costs 43,520 = 8,000 x 5.44
Total EWIP 139,500
Problem 11-2
1. Equivalent Units of ProductionMaterials:
Transferred out to next department 6,500
Ending work in process (100%) 500
EUP 7,000
Labor:
Transferred out to next department 6,500
Ending work in process (500 x 25%) 125
EUP 6,625
Overhead:
Transferred out to next department 6,500
Ending wok in process (500 x 40$) 200
EUP 6,700
2. Processing Department Cost of Production Report Month of April
Quantity Schedule Units
Beginning work in process 1,000
Transferred in 6,000
Total to account for 7,000 Transferred out to finished goods 6,500 Ending work in process 500 Total accounted for 7,000
Cost Schedule Total Cost EUP Unit Cost
Cost from prior department:
BWIP – Last month P 120,000 = 1,000 Transferred in – This month 732,000 = 6,000
Total transferred in costs 852,000 ÷ 7,000 = P121.714 Cost in this department:
Materials: BWIP 24,000 Current month 90,000 Total materials 114,000 ÷ 7,000 = 16.286 Labor: BWIP 25,060 Current month 107,440
Total labor cost 132,500 ÷ 6,625 = 20.00 Overhead:
BWIP 6,320 Current month 86,940
Total overhead cost 93,260 ÷ 6,700 = 13.919 Total costs to account for P 1,191,760 P171.919 Transferred out P 1,117,476* = 6,500 x P171.919 Ending work in process:
Cost from prior department 60,857 = 500 x 121.714 Costs this department:
Materials 8,143 = 500 x 16.286 Labor 2,500 = 125 x 20.0 Overhead 2,784 = 200 x 13.919 Total EWIP 74,284
Total costs accounted for P 1,191,760
Problem 11-3
Ace Department – First DepartmentEquivalent Units of Production Month of June, 2010
Materials:
Transferred out to next department 106,000
Ending work in process (100%) 8,000
EUP 114,000
Conversion costs:
Transferred out to next department 106,000
Ending work in process, (8,000 units x 70%) 5,600
EUP 111,600
Ace Company – First Department Cost of Production Report
Month of June 2010
Quantity Schedule Units
Beginning work in process 10,000
Started in process 104,000
Total to account for 114,000
Transferred out to next department 106,000 Ending work in process 8,000
Total accounted for 114,000
Cost Schedule Total Cost EUP Unit Cost
Materials: BWIP P 80,000 Current month 832,000 Total materials 912,000 ÷ 114,000 = P 8.00 Conversion Cost: BWIP 54,000 Current month 491,724 Total CC 545,724 ÷ 111,600 = 4.89 Total costs to account for P1,457,724 P12.89 Transferred out to next department P1,366,339* = 106,000 x P12.89 Ending work in process:
Materials 64,000 = 8,000 x 8.00 CC 27,384 = 5,600 x 4.89 Total EWIP 91,385
Problem 11-4
1. Tan Corporation – Shaping DepartmentEquivalent Units of Production Month of October 2010
Materials:
Units transferred out to finished goods 8,500 Units in ending work in process: (2,000 x 75%) 1,500
EUP 10,000
Conversion costs:
Units transferred out to finished goods 8,500 Units in ending work in process: (2,000 x 50%) 1,000
EUP 9,500
2. Tan Corporation – Shaping Department Cost of Production Report
Month of October 2010
Quantity Schedule Units
Beginning work in process 3,000 Transferred in from prior department 7,500 Units to account for 10,500
Transferred out 8,500
Ending work in process 2,000 Total accounted for 10,500
Cost Schedule Total Cost EUP Unit Cost
Cost from prior department:
BWIP P 62,000 = 3,000 Current month 253,000 = 7,500
Total transferred in cost 315,000 ÷ 10,500 = P30.00 Cost added this department:
Materials: BWIP 31,200 This month 82,800
Total material cost 114,000 ÷ 10,000 = 11.40 CC: BWIP 52,700
This month 226,600
Total CC 279,300 ÷ 9,500 = 29.40
Total costs to account for P708,300 P70.80
Transferred out P601,800 = 8,500 x P70.80 Ending work in process:
Cost from prior department 60,000 = 2,000 x 30.00 Cost added this department:
Materials 17,100 = 1,500 x 11.40 CC 29,400 = 1,000 x 29.40 Total work in process 106,500
Total costs accounted for P708,300 3. Work in process – Finishing Department 601,800
Work in process – Shaping Department 601,800 To record cost of units transferred to Finishing Department.
Problem 11-5
1. Assembling Department
Computation of Equivalent Units of Production Month of June 2010
Materials:
Completed and transferred out 8,000
Ending work in process: (4,000 x 90%) 3,600
EUP 11,600
Labor:
Completed and transferred out 8,000
Ending work in process: (4,000 x 70%) 2,800
EUP 10,800
Overhead:
Completed and transferred out 8,000
Ending work in process: (4,000 x 35%) 1,400
EUP 9,400
2. Assembling Department Cost of Production Report Month of June 2010
Quantity Schedule Units
Beginning work in process 2,000 Transferred in from prior department 10,000 Total units to account for 12,000 Completed and transferred out 8,000 Ending work in process 4,000 Total units accounted for 12,000
Cost Schedule Total cost EUP Unit Cost
Cost from prior department:
BWIP P 32,000 = 2,000
Cost this month 160,000 = 10,000
Total transferred in cost 192,000 ÷ 12,000 = P16.00 Cost added this department:
Materials: BWIP 20,000 This month 96,000
Total material cost 116,000 ÷ 11,600 = 10.00 Labor: BWIP 7,200
This month 36,000
Total labor cost 43.200 ÷ 10,800 = 4.00 Overhead: BWIP 5,500
This month 18,000
Total overhead cost 23,500 ÷ 9,400 = 2.50
Total costs to account for P374,700 P32.50
Completed and transferred out P260,000 = 8,000 x P32.50 Ending work in process:
Cost from preceding department 64,000 = 4,000 x 16,00 Cost added this department:
Materials 36,000 = 3,600 x 10.00 Labor 11,200 = 2,800 x 4.00 Overhead 3,500 = 1,400 x 2.50 Total ending work in process 114,700
Problem 11-6
1. Mixing DepartmentEquivalent Units of Production Month of May 2010
Direct materials:
Transferred out to Bottling Department 75,000
Ending work in process 9,000
EUP 84,000
Conversion costs:
Transferred out to bottling Department 75,000 Ending work in process (60% x 9,000) 5,400
EUP 80,400
2. Mixing Department Cost of Production Report Month of May 2010
Quantity Schedule Units
Beginning work in process 8,000 Started in process 76,000 Total to account for 84,000
Transferred out 75,000
Ending work in process 9,000 Total accounted for 84,000
Cost Schedule Total Cost EUP Unit Cost
Direct materials:
BWIP P 1,680
This month 18,480
Total material cost 20,160 ÷ 84,000 = P0.24 Conversion costs:
BWIP 4,020
This month 32,160
Total conversion costs 36,180 ÷ 80,000 = 0.45
Total costs to account for P56,340 P0.69
Transferred out to next department P51,750 = 75,000 x P0.69 Ending work in process:
Direct materials 2,160 = 9,000 x 0.24 Conversion costs 2,430 = 5,400 x 0.45 Total ending work in process 4,590
Total costs accounted for P56,340
3. Work in process –Bottling Department 51,750
Work in process – Mixing Department 51,750 To record cost units finished transferred out.
Problem 11-6 (continued):
4. Bottling Department
Equivalent Units of Production Month of May 2010
Direct materials:
Transferred out to finished goods 68,000
Ending work in process 0
-EUP 68,000
Conversion costs;
Transferred out to finished goods 68,000 Ending work in process (8,000 x 100%) 8,000
EUP 76,000
Bottling Department Cost of Production Report Month of May 2010
Quantity Schedule Units
Beginning work in process 8,000 Transferred in from prior department 75,000 Total to account for 83,000 Transferred out finished goods 68,000 Ending work in process 15,000 Total accounted for 83,000
Cost Schedule Total Cost EUP Unit Cost
Cost from prior department
BWIP P 6,350 = 8,000 This month 51,750 = 75,000
Total transferred in costs 58,100 ÷ 83,000 = P0.70 Cost added this department:
Conversion costs:
BWIP 2,220
This month 25,900
Total conversion cost 28,120 ÷ 76,000 = 0.37
Total costs to account for P86,220 P1.07
Transferred out to finished goods P72,760 = 68,000 x P1.07 Ending work in process:
Cost from prior department 10,500 = 15,000 x 0.70 Cost added this department:
Conversion costs 2,960 = 8,000 x 0.37 Total ending work in process 13,460
Total costs accounted for P86,220
5. Finished goods inventory 72,760
Work in process – Bottling Department 72,760
Problem 11-7
1. Equivalent Units of ProductionDept. 1 Dept. 2 Materials:
Transferred out 45,000 43,000
Ending work in process (100%) 10,000 9,000
EUP 55,000 52,000
Conversion costs:
Transferred out 45,000 43,000
Ending work in process (75%; 50%) 7,500 4,500
EUP 52,500 47,500
2. Department 1
Cost of Production Report Month of April 2010
Quantity Schedule Units
Beginning work in process 5,000
Started in process 50,000
Total to account for 55,000
Transferred out to next department 45,000
Ending work in process 10,000
Total accounted for 55,000
Cost Schedule Total Costs EUP Unit Costs Materials:
BWIP P 12,000
This month 65,000
Total material cost 77,000 ÷ 55,000 = P 1.40 Conversion costs:
BWIP 18,800
This month 145,000
Total conversion costs 163,800 ÷ 52,500 = 3.12
Total costs to account for P240,800 P 4.52
Transferred out to next department P203,400 = 45,000 x P 4.52 Ending work in process:
Materials 14,000 = 10,000 x 1.40 Conversion costs 23,400 = 7,500 x 3.12 Total ending work in process 37,400
Problem 11-7 (continued) Department 2
Cost of Production Report Month of April 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 43,000 Ending work in process 9,000
Total accounted for 52,000
Cost Schedule Total Cost EUP Unit Cost Cost from preceding department:
BWIP P 28,000 = 7,000
This month 203,400 = 45,000
Total transferred in costs 231,400 ÷ 52,000 = P 4.45 Cost added this department:
Materials: BWIP 14,800 This month 45,000
Total material cost 59,800 ÷ 52,000 = 1.15 CC : BWIP 20,625
This month 110,000
Total CC 130,625 ÷ 47,500 = 2.75
Total costs to account for P421,825 P 8.35
Transferred out to finished goods P359,050 = 43,000 x P 8.35 Ending work in process:
Cost from prior department 40,050 = 9,000 x 4.45 Cost added this department:
Materials 10,350 = 9,000 x 1.15 Conversion costs 12,375 = 4,500 x 2.75 Total work in process 62,775
Problem 11-8
1. Equivalent Units of Production Blending Finishing Department Department Materials:
Transferred out 2,180 2,000
Ending work in process: 100%; 85% 320 238
EUP 2,500 2,238
Conversion costs;
Transferred out 2,180 2,000
Ending work in process: 25%; 85% 80 238
EUP 2,260 2,238
2. Orange Company
Cost of Production Report Month of March 2010
Blending Department Finishing Department
Quantity Schedule Units Units
Beginning work in process 200 100
Started in process/transferred in 2,300 2,180
Total to account for 2,500 2,280
Transferred out 2,180 2,000
Ending work in process 320 280
Total accounted for 2,500 2,280
Cost Schedule Total Costs Unit costs Total Costs Unit Costs
Transferred in from prior department:
BWIP P - P - P 15,188
This month - - 339,971
Total transferred in costs 355,159 P155.77 Cost added this department:
Materials: BWIP 8,000 1,641
This month 100,000 42,000
Total material costs 108,000 43.20 43,641 19.50
C. Costs: BWIP 47,215 1,840
This month 207,600 73,200
Total conversion costs 254,815 112.75 75,040 33.53 Total costs to account for P362,815 P155.95 P473,840 P208.80
Transferred out P339,971 P155.95 417,603* P208.80
Ending work in process:
Transferred in from prior department - - 43,616 155.77 Cost added this department:
Materials 13,824 43.20 4,641 19.50 Conversion costs 9,020 112.75 7.980 33.53 Total work in process 22,844 56,237
*P3 difference due to rounding
Problem 11-9
a. Striping Department:Beginning work in process inventory P 20,000
Current costs:
DM 90,000
DL 80,000
Overhead (P80,000 x 80%) 64,000
Total P254,000
Less ending work in process inventory 17,000
Costs transferred to Adhesion P237,000
b. Adhesion Department: Let CC = conversion costs
BWIP + TI + DM + CC - To = EWIP P70,000 + P237,000 + P22,600 + CC - P480,000 = P20,600 CC - P150,000 = P20,600 CC = P171,000 DL + OH = CC DL + .80DL = CC 1.80DL = P171,000 DL = P95,000 OH = P95,000 x .80 = P76,000
c. Cost of goods manufactured is equal to the cost of goods transferred to finished goods (P880,000). OH = .80 DL P90,000 = .80 DL DL = P112,500 BWIP + TI + DM + DL + OH - CGM = P40,000 P150,000 + P480,000 + DM + P112,500 + P90,000 - P880,000 = P40,000 DM - P47,500 = P40,000 DM = P87,500
d. Work in process inventory – Adhesion 237,000
Work in process inventory – Striping 237,000
Work in process inventory – Packaging 480,000
Work in process inventory – Adhesion 480,000
Finished goods inventory 880,000
Work in process inventory – Packaging 880,000
