PRACTICAL

ACCOUNTING 2
Saturday, June 27, 2015

PROCESS COSTING
1. Short Company transferred 5,500 units to Finished Goods Inventory during June. On
June 1, the company had 300 units on hand (40% complete as to both material and
conversion costs). On June 30, the company had 800 units (10% complete as to
material and 20% complete as to conversion costs). The number of units started
and completed during June was
a. 5,200
c. 5,500
b. 5,380
d. 6,300
IP beg
SIP
Total

300
6000
6300

IPend
800
Completed
5500
IPbeg
SIP
Total
6300

300
5200

5500 300 = 5200 started and completed

EUP-Materials
EUP CC

5500 x 100% + 800 x 10% = 5580

5500 x 100% + 800 x 20%= 5660

2. Brown Co. started 9,000 units in October. The company transferred 7,000 finished
units and ended the period with 3,500 units that were 40% complete as to both
material and conversion costs. Beginning Work in Process Inventory units were
a.
500
c. 1,500
b.
600
d. 2,000
IP beg
SIP
Total

1500
9000
10500

IPend
3500
Completed
7000
Total
10500
3. X Co. had beginning Work in Process Inventory of 5,000 units that were 40%
complete as to conversion. X started and completed 42,000 units this period and
had ending Work in Process Inventory of 12,000 units. How many units were started
this period?
a. 54,000
c. 42,000
b. 59,000
d. 47,000
IP beg
SIP
Total

5000
54000
59000

IPend
12000
Completed
47000
IPbeg
5000
SIP
42000
Total
59000
4. Winn Co. uses weighted average process costing system. Material is added at the
start of production. Winn Co. started 13,000 units into production and had 4,500
units in process at the start of the period that was 60% complete as to conversion. If
Winn transferred out 11,750 units, how many units were in ending Work in Process
Inventory?
a. 1,250
c. 5,750
b. 3,500
d. 3,000
IP beg
SIP
Total

4500
13000
17500

IPend
Completed
Total

5750
11750
17500

5. Murphy Co. uses a weighted average process costing system and started 30,000
units this month. Murphy had 12,000 units that were 20% complete as to
conversion in beginning Work in Process Inventory and 3,000 units that were 40%
complete as to conversion in ending Work in Process Inventory. What are equivalent
units for conversion?
a. 37,800
c. 40,200
b. 42,000
d. 40,800
IP beg
SIP
Total
IPend
Completed
Total

12000
30000
42000
QTY % of comp
3000 x 40%
39000 x100%
42000

EUP
= 1200
=39000
= 40200

6. Kim Co. makes small metal containers. The company began December with 250
containers in process that were 30% complete as to material and 40% complete as
to conversion. During the month, 5,000 containers were started. At month end,
1,700 containers were still in process (45% complete as to material and 80%
complete as to conversion). Using the weighted average method, what are the
equivalent units for conversion?
a. 4,610
c. 3,450
b. 4,910
d. 4,560
IP beg
SIP
Total
IPend
Completed
Total

250
5000
5250
QTY % of comp
1700 x 80%
3550 x100%
5250

EUP
= 1360
=3550
= 4910

7. Zammillo Co. uses a FIFO process costing system. The company had 5,000 units
that were 60% complete as to conversion at the beginning of the month. The
company started 22,000 units this period and had 7,000 units in ending Work in
Process Inventory that were 35% complete as to conversion. What are equivalent
units for material, if material is added at the beginning of the process?
a. 18,000
c. 25,000
b. 22,000
d. 27,000
IP beg
SIP
Total

5000
22000
27000

IPend
7000
x 100%
= 7000
Completed
20000
IPbeg
5000 x 0%
SIP
15000 x 100%
=15000
Total
27000
= 22000
8. Lisa Co. makes fabric-covered hatboxes. The company began August with 500
boxes in process that were 100% complete as to cardboard, 80% complete as to
cloth and 60% complete as to conversion. During the month, 3,300 boxes were
started. On August 31, 350 boxes were in process (100% complete as to cardboard,
70% complete as to cloth and 55% complete as to conversion). Using the FIFO
method, What are equivalent units for cloth?
a. 3,450
c. 3,395
b. 3,295
d. 3,595
Ip beg
SIP
Total`

500 80%
3300
3800

IP end
350
completed
3450
ip beg
sip
total
3800
245 + 3450
less (500 x 80%)

EP
70%
500
2950

EUP
= 245

20%
= 100
100% =2950
3295 eup fifo

= 3695 eup ave

= 400
3295

Use the following information for questions 9-11.

9. Forte Co. has the following information for May:
Beginning
Work
In
Process
Inventory
(70%
complete
as
to
conversion)
6,000 units
Started
24,000 units
Ending
Work
In
Process
Inventory
(10%
complete
as
to
conversion)
8,500 units
Beginning WIP Inventory Costs:
Material
P 23,400
Conversion
50,607
Current Period Costs:
Material
P 31,500
Conversion
76,956
All material is added at the start of the process and all finished products are
transferred out.
How many units were transferred out in May?
a.
15,500
c. 21,500
b.
18,000
d. 24,000
10. Assume that weighted average process costing is used. What is the
cost per equivalent unit for material?
a.
P 1.83
c. P 0.55
b.
P 1.05
d. P 1.31
11. Assume that FIFO process costing is used. What is the cost per equivalent unit for
conversion?
a.
P 7.03
c. P 4.24
b.
P 3.44
d. P 5.71
12. The December 25th Co. makes wreaths in two departments:
Forming and Decorating. Forming began the month with 500 wreaths in process
that were 100% complete as to materials and 40% complete as to conversion.
During the month, 6,500 wreaths were started. At month end, Forming had 2,100
wreaths that were still in process that were 100% complete as to material and 50%
complete as to conversion. Assume Forming uses the weighted average method of
process costing. Costs in Forming Department are as follows:

Beginning Work in Process Costs

Materials
P 1,000
Conversion
1,500
Current Costs
Material
Conversion

P 3,200
5,045

The Decorating Department had 600 wreaths in process at the beginning of the
month that were 80% complete as to material and 90% complete as to conversion.
The Department had 300 units in ending Work in Process that were 50% complete
as to material and 75% complete as to conversion. Decorating uses FIFO and costs
associated with Decorating are:
Beginning WIP Inventory:
Transferred In
P 1,170
Material
4,320
Conversion
6,210
Current Period:
Transferred In
Material
Conversion

?
P 67,745
95,820

How many units were transferred to Decorating during the month?

a.
7,000
c. 4,900
b.
600
d. 5,950
13. What was the cost transferred out of Forming during the month?
a.
P 6,419
c. P 8,330
b.
P 5,341
d. P 8,245
14. Disregard your answer in to question 12. Assume 8,000 units were transferred to
Decorating. Compute the number of equivalent units as to costs in Decorating for
the transferred-in cost component.
a.
7,700
c. 8,600
b.
8,000
d. 7,400
15. Disregard your answer in to question 12. Assume 8,000 units were transferred to
Decorating. Compute the number of equivalent units as to costs in Decorating for
material.
a.
8,000
c. 8,330
b.
8,450
d. 7,970
16. Disregard your answer in to question 12. Assume 8,000 units were transferred to Decorating.
Compute the number of equivalent units as to costs in Decorating for conversion.

a.
b.

7,985
8,465

c. 8,360
d. 7,925

17. Disregard your answer in to question 12. Assume 8,000 units were transferred to Decorating at a total
cost of P16,000. What is the material cost per equivalent unit as to costs in Decorating?

a.
b.

P8.80
P8.65

c. P8.50
d. P9.04

18. Disregard your answer in to question 12. Assume 8,000 units were transferred to Decorating at a total
cost of P16,000. What is the conversion cost per equivalent unit in Decorating?

a.
b.

P 12.00
P 12.78

c. P 11.32
d. P 11.46

19. Assume material cost per EUP is P8.00 and the conversion cost per EUP Is P15 in Decorating. What
is the cost of completing the units in beginning inventory?

a.
b.

P 11,940
P
960

c. P 1,380
d. P 1,860

20. BCW Co. adds material at the start to its production process and has the following
information available for November:
Beginning Work in Process Inventory
( 40% complete as to conversion)
7,000 units
Started this period
32,000 units
Ending Work in Process Inventory
(25% complete as to conversion)
2,500 units
Transferred out
?
Compute the number of units started and completed in November.
a.
29,500
c. 36,500
b.
39,000
d. 34,500
21.
a.
b.

Calculate equivalent units of production for material using FIFO.

36,800
c. 39,000
32,000
d. 37,125

22.
a.
b.

Calculate equivalent units of production for conversion using FIFO.

34,325
c. 37,125
30,125
d. 39,000

23.
Calculate equivalent units of production for material using weighted
average.
a.
34,325
c. 37,125
b.
32,000
d. 39,000
24.
Calculate equivalent units of production for conversion using weighted
average.
a.
39,925
c. 34,325
b.
37,125
d. 38,375
25. Storey Co. adds material at the start of production. February information for the
company follows:
Beginning Work in Process Inventory
( 45% complete as to conversion)
Started this period
Ending Work in Process Inventory

10,000 units
120,000 units

(80% complete as to conversion)

8,200 units

Beginning Work in Process Inventory Costs:

Materials
P 24,500
Conversion
68,905
Current Period Costs:
Material
P 75,600
Conversion
130,053
How many units must be accounted for?
a.
128,200
b.
138,200

c. 130,000
d. 118,200

26.
a.
b.

What is the total cost to account for?

P205,653
c. P 93,405
P299,058
d. P274,558

27.
a.
b.

How many units were started and completed in the period?

120,000
c. 121,800
111,800
d. 130,000

28.
What are the equivalent units for materials using the weighted average
method?
a.
120,000
c. 130,000
b.
128,360
d. 123,860
29.
a.
b.

a.
b.

What are the equivalent units for materials using the FIFO method?
130,000
c. 111,800
125,500
d. 120,000

30.
What are the equivalent units for conversion using the weighted average
method?
128,360
c. 130,000
123,440
d. 120,000
31.
a.
b.

What are the equivalent units for conversion using the FIFO method?
128,360
c. 118,360
123,860
d. 122,860

32.
What is the material cost per equivalent unit using the weighted average
method?
a.
P 0.58
c. P 0.77
b.
P 0.62
d. P 0.82

33.
What is the conversion cost per equivalent unit using the weighted average
method?
a.
P 1.61
c. P 1.05

b.
34.

P 1.55

d. P 1.01

a.
b.

What is the cost of units completed using the weighted average?

P 266,742
c. P 278,400
P 282,576
d. P 237,510

a.
b.

What is the conversion cost per equivalent unit using the FIFO method?
P 1.05
c. P1.61
P 0.95
d. P1.55

a.
b.

What is the cost of all units transferred out using the FIFO method?
P 204,624
c. P 287,004
P 191,289
d. P 298,029

35.

36.

37. The following information relate to I M Cute Company:

Beginning Inventory
( 30% complete for material B and
60% complete for conversion)
700 units
Started this cycle
2,000 units
Ending Inventory
(50% complete as to material B and
80% complete for conversion)
500 units
Beginning Inventory Costs:
Material A
P 14,270
Material B
5,950
Conversion
5,640
Current Period Costs:
Material A
P 40,000
Material B
70,000
Conversion
98,100
Material A is added at the start of production, while Material B is added when
production is 40% complete.
Assuming
Materials A
a.
b.
c.
d.

a weighted average method of process costing, compute EUP units for

and B.
2,700 and 2,280 respectively
2,700 and 2,450 respectively
2,000 and 2,240 respectively
2,240 and 2,700 respectively

38.
Assuming a FIFO method of process costing, compute EUP units for Materials
A and B.
a.
2,700 and 2,280 respectively
b.
2,700 and 2,450 respectively
c.
2,000 and 2,240 respectively
d.
2,250 and 2,880 respectively

39.
Assuming a weighted average method of process costing, compute EUP for
conversion.
a.
2,280
c. 2,000
b.
2,180
d. 2,700
40.
a.
b.

Assuming a FIFO method of process costing, compute EUP for conversion.

2,240
c. 2,280
2,180
d. 2,700

41. Assuming a weighted average method of process costing, compute the average cost per unit for
Material A.

a.
b.

P 20.10
P 20.00

c. P 31.25
d. P 31.00

42. Assuming a FIFO method of process costing, compute the average cost per EUP for
Material A.
a.
P 31.25
c. P 20.00
b.
P 20.10
d. P 31.00
43. Assuming a FIFO method of process costing, compute the average cost per EUP for Material B.

a.
b.

P 20.10
P 31.25

c. P 20.00
d. P 31.00

44. Assuming a weighted average method of process costing, compute the average cost per EUP for
Material B.

a.
b.

P 20.00
P 31.25

c. P 20.10
d. P 31.00

45. Assuming a FIFO method of process costing, compute the average cost per EUP
for conversion.
a.
P 45.50
c. P 43.03
b.
P 45.00
d. P 47.59
46. Assuming a weighted average method of process costing, compute the average cost per EUP for
conversion.

a.
b.

P 45.50
P 45.00

c. P 43.03
d. P 47.59

47. The following information is available for K Co. for June:

Started this month
80,000 units
Beginning WIP (40% complete)
7,500 units
Normal spoilage (discrete)
1,100 units
Abnormal spoilage
900 units
Ending WIP (70% complete)
13,000 units
Transferred Out
72,500 units
Beginning Work in Process Costs:
Materials
P 10,400
Conversion
13,800
Current Costs:
Materials

P 120,000

Conversion

350,000

All materials are added at the start of production and the inspection point is at the
end of the process.
What are equivalent units of production for materials using FIFO?
a.
80,000
c. 78,900
b.
79,100
d. 87,500
48.
a.
b.

What are the equivalent units of production for conversion costs using FIFO?
79,700
c. 81,100
79,500
d. 80,600

49.
What are the equivalent units of production for materials using weighted
average?
a.
86,600
c. 86,400
b.
87,500
d. 85,500

50.
What are equivalent units of production for conversion costs using weighted
average?
a.
83,600
c. 82,500
b.
82,700
d. 81,600
51.
a.
b.

What is cost per equivalent unit for materials using FIFO?

P 1.63
c. P 1.50
P 1.37
d. P 1.56

a.
b.

What is cost per equivalent unit for conversion cost using FIFO?
P 4.00
c. P 4.34
P 4.19
d. P 4.38

a.
b.

What is cost per equivalent unit for materials using weighted average?
P 1.49
c. P 1.56
P 1.63
d. P 1.44

52.

53.

54.
What is cost per equivalent unit for conversion costs using weighted
average?
a.
P 4.19
c. P 4.55
b.
P 4.41
d. P 4.35
55. What is the cost assigned to ending inventory using FIFO?
a.
P 75,920
c. P 56,420
b.
P 58,994
d. P 53,144
56. What is the cost assigned to abnormal spoilage using FIFO?
a.
P 1,350
c. P 5,256
b.
P 3,906
d. P 6,424

57. What is the cost assigned to normal spoilage and how is it classified using the
weighted average?
a.
P 6,193 allocated between WIP and Transferred Out
b.
P 6,424 assigned to units Transferred Out
c.
P 6,193 assigned to loss account
d.
P 6,424 assigned to units Transferred Out
58. What is the total cost assigned to goods transferred out using weighted
average?
a.
P 435,080
c. P 428,656
b.
P 429,824
d. P 423,400
The following information is available for OP Company for the current year:
Beginning WIP (75% complete)
14,500 units
Started
75,000 units
Ending WIP (60% complete)
16,000 units
Abnormal Spoilage
2,500 units
Normal Spoilage (continuous)
5,000 units
Transferred Out
66,000 units
All materials are added at the start of production.
Cost of Beginning Work in Process
Materials
P 25,100
Conversion
50,000
Current Cost
Materials
P120,000
Conversion
300,000
59. Using weighted average, what are equivalent units for materials?
a.
82,000
c. 84,500
b.
89,500
d. 70,000
60.
a.
b.

Using weighted average, what are equivalent units for conversion costs?
80,600
c. 83,100
78,100
d. 75,600

61. What is the cost per equivalent unit for materials using weighted average?
a.
P 1.72
c. P 1.77
b.
P 1.62
d. P 2.07
62. What is the cost per equivalent unit for conversion costs using weighted average?
a.
P 4.62
c. P 4.48
b.
P 4.21
d. P 4.34
63. What is the cost assigned to normal spoilage using weighted average?
a.
P31,000
c. P30,850
b.
P15,500
d. None of the above
64. Assume that the cost per EUP for materials and conversion are P 1.75 and P 4.55,
respectively. What is the cost assigned to ending Work in Process?

a.
b.

P 100,800
P 87,430

c. P 103,180
d. P 71,680

65. Using FIFO, what are equivalent units for materials?

a.
75,000
c. 84,500
b.
72,500
d. 70,000
66. Using FIFO, what are equivalent units for conversion costs?
a.
72,225
c. 69,725
b.
67,225
d. 78,100
67. Using FIFO, what is the cost per equivalent unit for materials?
a.
P 1.42
c. P 1.71
b.
P 1.66
d. P 1.60
68. Using FIFO, what is the cost per equivalent unit for conversion costs?
a.
P 4.46
c. P 4.30
b.
P 4.15
d. P 3.84
69. Assume that the FIFO EUP cost for materials and conversion are P 1.50 and P 4.75,
respectively. Using FIFO, what is the total cost assigned to the units transferred out?
a.
P 414,194
c. P 445,444
b.
P 339,094
d. P 396,975
70. T Company has the following information for July:
Units started
100,000 units
Beginning WIP (35% complete)
20,000 units
Normal Spoilage (discrete)
3,500 units
Abnormal Spoilage
5,000 units
Ending WIP (70% complete)
14,500 units
Transferred Out
97,000 units
Beginning Work in Process Costs:
Materials
P 15,000
Conversion
10,000
All materials are added at the start of the production process. T Co. inspects goods
at 75% completion as to conversion.
What are the equivalent units of production for materials assuming FIFO?
a.
100,000
c. 95,000
b.
96,500
d. 120,000
71. What are the equivalent units of production for conversion costs, assuming FIFO?
a.
108,900
c. 108,650
b.
103,900
d. 106,525
72. Assume that the costs per EUP for materials and conversion are P 1.00 and P 1.50,
respectively. What is the amount of the period cost for July using FIFO?
a.
P0
c. P 10,625
b.
P 9,375
d. P 12,500

73.
Assume that the costs per EUP for materials and conversion are P 1.00 and P
1.50, respectively. Using FIFO, what is the total cost assigned to the transferred out
units (rounded to the nearest peso)?
a.
P 245,750
c. P 237,000
b.
P 244,438
d. P 224,938
74.
What are equivalent units of production for materials assuming weighted
average is used?
a.
107,000
c. 120,000
b.
116,500
d. 115,000
75. What are equivalent units of production for conversion costs assuming weighted
average is used?
a.
113,525
c. 114,775
b.
114,400
d. 115,650
76. Assume that the costs per EUP for materials and conversion are P 1.00 and P 1.50,
respectively. What is the cost assigned to normal spoilage, using weighted average,
and where is it assigned?
Value
Assigned To
a.
P 7,437.50
Units transferred out and EI
b.
P 7,437.50
Units transferred out
c.
P 8,750.00
Units transferred out and EI
d.
P 8,750.00
Units transferred out
77. Assume that the costs per EUP for materials and conversion are P 1.00 and P 1.50,
respectively. Assuming that weighted average is used, what is the cost assigned to
ending inventory?
a.
P 29,725.00
b.
P 37,162.50
c.
P 38,475.00
d.
P 36,250.00

Questions 9-11
AVERAGE
QT
Y
IP beg (70%cc, materials
100%)
SIP
Tot
al

IP end (10% cc, 100%

6000
24000
30000
Materials
CC
EP
EUP
EP
EUP
8500 100
8500
10%
850

materials)
Completed
IP beg
Started &
Completed
Tot
al

21500

30000

23400

31500

CC

Total
50607

76956

3000
0

Cost per
EU ofMaterials
(54900 /
30000)

54900

Cost Accounted For As

Follows:
Completed(21500 x
7.537517)
IP
Materials (8500 x 100%
end x1.83)
CC (8500 x 10% x
5.707517)

108456

182,46
127563 3.00

162,05
6.61
15,555
.00
4,85
1.39

Total Cost Accounted For

20,40
6.39
182,46
3.00

FIF
O
QT
Y
IP beg (70%cc, materials
100%)
SIP

6000
24000

Total IP end

21500

22350

1.83

74007
Cost per EU of
CC
(127563 /
22350)
Total

Total Cost to be
Accounted For

100%

15500

Materi
als

Cost added by the Dept

2150
0

6000

Cost Charged To the

Department:

IP
beg

%
100
%

5.7075
17
7.5375
17

Tot
al

30000

IP end (10% cc, 100%

materials)
Completed
IP beg
Started &
Completed
Tot
al

Materials
CC
EP
EUP
EP
EUP
100
8500
%
8500
10%
850
6000

6000

15500

15500
30000

Cost Charged To the

Department:

Materi
als
IP
beg

CC

23400

Cost added by the Dept

31500

Total Cost to be
Accounted For

54900

Cost Accounted For As

Follows:

Materi
als

Total
50607

76956

0%
100
%

0
1550
0
2400
0

30%

1800

100%

15500

Cost per
EU ofMaterials
(31500 /
24000)
1.3125

74007

108456

Cost per EU of
CC
(76956 /
18150)
Total

182,46
127563 3.00

CC

Total

Completed

74,00

IP beg
Cost Added to
Complete
Total

23400

50607 7.00

0
23400

7,63 (6000 x 30% x

7632 2.00
4.24)
58239
81639

Started and Completed (15500 x

5.5525)
Total Completed
IP
Materials (8500 x 100%
end x1.3125)
CC (8500 x 10%
x4.24)
Total IP end

18150

86,06
3.75
167,70
2.75

11,156
.25
3,60
4.00
14,76

4.24
5.5525

0.25
182,46
3.00

Total Cost Accounted For

ANSWER KEY - PROCESS COSTING

1

21 B

22 A

23 D

24 B

25 C

26 B

27 B

28 C

29 D

10 A

30 A

11 C

31 B

12 C

32 C

13 C

33 B

14 B

34 B

15 D

35 A

16 A

36 C

17 C

37 B

18 A

38 C

19 D

39 A

4
1
4
2
4
3
4
4
4
5
4
6
4
7
4
8
4
9
5
0
5
1
5
2
5
3
5
4
5
5
5
6
5
7
5
8
5
9

61 A

62 C

63 D

64 D

65 D

66 B

67 C

68 A

69 A

70 A

71 D

72 C

73 B

74 C

75 A

76 B

77 A

B
C

20 A

40 B

6
0
.