Holmes Products, Inc., produces plastic cases used for video cameras. The product passes through three departments. For April, the following equivalent units schedule was prepared for the first department: Direct Materials Conversion Costs Units completed 25,000 25,000 Units, ending work in process × Percentage complete: 7,000 × 100% 7,000 — 7,000 × 50% — 3,500 Equivalent units of output 32,000 28,500 Costs assigned to beginning work in process: direct materials, $80,000; conversion costs, $15,125. Manufacturing costs incurred during April: direct materials, $80,000; conversion costs, $220,000. Holmes uses the weighted average method. Required: 1. Compute the unit cost for April. If required, round your answer to the nearest cent. $fill in the blank 1 per equivalent unit 2. Determine the cost of ending work in process and the cost of goods transferred out. Cost of ending work in process $fill in the blank 2 Cost of goods transferred out $fill in the blank 3
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Weighted Average Method, Unit Cost, Valuation of Goods Transferred Out and Ending Work in Process
Holmes Products, Inc., produces plastic cases used for video cameras. The product passes through three departments. For April, the following equivalent units schedule was prepared for the first department:
| Direct Materials | Conversion Costs | |||||||
| Units completed | 25,000 | 25,000 | ||||||
| Units, ending work in process × Percentage complete: |
||||||||
| 7,000 × 100% | 7,000 | — | ||||||
| 7,000 × 50% | — | 3,500 | ||||||
| Equivalent units of output | 32,000 | 28,500 |
Costs assigned to beginning work in process: direct materials, $80,000; conversion costs, $15,125.
Required:
1. Compute the unit cost for April. If required, round your answer to the nearest cent.
$fill in the blank 1 per equivalent unit
2. Determine the cost of ending work in process and the cost of goods transferred out.
| Cost of ending work in process | $fill in the blank 2 |
| Cost of goods transferred out | $fill in the blank 3 |
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
