Overstitch Textiles Company makes silk banners and uses the FIFO method of process costing. Direct materials are added at the beginning of the process, and conversion costs are added evenly during the process. Spoilage is detected upon inspection at the completion of the process. Spoiled units are disposed of at zero net disposal value. E (Click the icon to view the process costing data.) Determine the equivalent units of work done in July, and calculate the cost of units completed and transferred out (including normal spoilage), the cost of abnormal spoilage, and the cost of units in ending inventory. For each cost category, compute equivalent units. Enter the physical units in first, then calculate the equivalent units. (Complete all input fields. Enter a "o" for any zero amounts.) Physical Data table Flow of Production Units Work in process beginning Physical Units Direct Conversion Started during current period Materials (Banners) 2,000 Costs To account for $9,000 $1,200 Work in process, (July 1)a Started in July 2020 Good units completed and transferred out in July Normal spoilage Abnormal spoilage Work in process, July 31 Total costs added during July 2020 Degree of completion: direct materials 100%; conversion costs, 50% Degree of completion: direct materials, 100%; conversion costs 30% Completed and transferred out during current period 10,800 220 From beginning work in process Started and completed 40 1,700 Normal spoilage $19,368 $31,710 Abnormal spoilage Work in process, ending Accounted for Equivalent units of work done in current period Print Done Etext pages Calculator Ask my instructor
Overstitch Textiles Company makes silk banners and uses the FIFO method of process costing. Direct materials are added at the beginning of the process, and conversion costs are added evenly during the process. Spoilage is detected upon inspection at the completion of the process. Spoiled units are disposed of at zero net disposal value. E (Click the icon to view the process costing data.) Determine the equivalent units of work done in July, and calculate the cost of units completed and transferred out (including normal spoilage), the cost of abnormal spoilage, and the cost of units in ending inventory. For each cost category, compute equivalent units. Enter the physical units in first, then calculate the equivalent units. (Complete all input fields. Enter a "o" for any zero amounts.) Physical Data table Flow of Production Units Work in process beginning Physical Units Direct Conversion Started during current period Materials (Banners) 2,000 Costs To account for $9,000 $1,200 Work in process, (July 1)a Started in July 2020 Good units completed and transferred out in July Normal spoilage Abnormal spoilage Work in process, July 31 Total costs added during July 2020 Degree of completion: direct materials 100%; conversion costs, 50% Degree of completion: direct materials, 100%; conversion costs 30% Completed and transferred out during current period 10,800 220 From beginning work in process Started and completed 40 1,700 Normal spoilage $19,368 $31,710 Abnormal spoilage Work in process, ending Accounted for Equivalent units of work done in current period Print Done Etext pages Calculator Ask my instructor
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Concept explainers
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.
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Transcribed Image Text:Overstitch Textiles Company makes silk banners and uses the FIFO method of process costing. Direct materials are added at the beginning of the process, and conversion costs are added evenly during the process. Spoilage is detected upon
inspection at the completion of the process. Spoiled units are disposed of at zero net disposal value.
(Click the icon to view the process costing data.)
Determine the equivalent units of work done in July, and calculate the cost of units completed and transferred out (including normal spoilage), the cost of abnormal spoilage, and the cost of units in ending inventory.
For each cost category, compute equivalent units.
Enter the physical units in first, then calculate the equivalent units. (Complete all input fields. Enter a "0" for any zero amounts.)
Physical
Data table
Flow of Production
Units
Work in process beginning
Physical Units
Direct
Conversion
Started during current period
(Banners)
Materials
Costs
To account for
2,000
$9,000
$1,200
Work in process, (July 1)a
Started in July 2020
Good units completed and transferred out in July
Normal spoilage
Abnormal spoilage
Completed and transferred out during current period
?
10,800
From beginning work in process
220
Started and completed
40
Work in process, July 31°
Total costs added during July 2020
1,700
Normal spoilage
$19,368
$31,710
Abnormal spoilage
aDegree of completion: direct materials 100%; conversion costs, 50%
'Degree of completion: direct materials, 100%; conversion costs 30%
Work in process, ending
Accounted for
Equivalent units of work done in current period
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Done
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