RSTN Company produces its product in two sequential processing departments. During October, the first process finished and transferred 160,000 units of its product to the second process. Of these units, 36,000 were in process at the beginning of the month and 124,000 were started and completed during the month. At month-end, 26,000 units were in process. Compute the number of equivalent units of production for direct materials for the first process for October under each of the following three separate assumptions using the FIFO method. 1. All direct materials are added to products when processing begins. 2. Beginning work in process inventory is 35% complete for direct materials cost. Ending inventory is 85% complete for direct materials cost 3. Beginning work in process inventory is 60% complete for direct materials cost. Ending inventory is 20% complete for direct materials cost Equivalent Units of Production (EUP)-FIFO Method 1. All direct materials are added to products when processing begins. Total Units Direct Materials Percent Added Units 2. Beginning work in process inventory is 35% complete for direct materials cost. Ending Inventory is 85% complete for direct materials cost. EUP Direct Materials Percent Added EUP
RSTN Company produces its product in two sequential processing departments. During October, the first process finished and transferred 160,000 units of its product to the second process. Of these units, 36,000 were in process at the beginning of the month and 124,000 were started and completed during the month. At month-end, 26,000 units were in process. Compute the number of equivalent units of production for direct materials for the first process for October under each of the following three separate assumptions using the FIFO method. 1. All direct materials are added to products when processing begins. 2. Beginning work in process inventory is 35% complete for direct materials cost. Ending inventory is 85% complete for direct materials cost 3. Beginning work in process inventory is 60% complete for direct materials cost. Ending inventory is 20% complete for direct materials cost Equivalent Units of Production (EUP)-FIFO Method 1. All direct materials are added to products when processing begins. Total Units Direct Materials Percent Added Units 2. Beginning work in process inventory is 35% complete for direct materials cost. Ending Inventory is 85% complete for direct materials cost. EUP Direct Materials Percent Added EUP
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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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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RSTN Company produces its product in two sequential processing departments. During October, the first process finished and
transferred 160,000 units of its product to the second process. Of these units, 36,000 were in process at the beginning of the month
and 124,000 were started and completed during the month. At month-end, 26,000 units were in process.
Compute the number of equivalent units of production for direct materials for the first process for October under each of the following
three separate assumptions using the FIFO method.
1. All direct materials are added to products when processing begins.
2. Beginning work in process inventory is 35% complete for direct materials cost. Ending inventory is 85% complete for direct
materials cost
3. Beginning work in process inventory is 60% complete for direct materials cost. Ending inventory is 20% complete for direct
materials cost
Equivalent Units of Production (EUP)-FIFO Method
1. All direct materials are added to products when processing begins.
Total
Units
Direct Materials
Percent Added
Units
2. Beginning work in process inventory is 35% complete for direct materials cost. Ending Inventory
is 85% complete for direct materials cost.
EUP
Direct Materials
Percent Added
EUP
Seore answar
Transcribed Image Text:Total
Total
e prvovany vegna
Units
Total
2. Beginning work in process inventory is 35% complete for direct materials cost. Ending inventory
Is 85% complete for direct materials cost.
Units
Direct Materials
Percent Added
Units
EUP
Direct Materials
Percent Added
3. Beginning work in process inventory is 60% complete for direct materials cost. Ending Inventory
is 20% complete for direct materials cost.
Percent Added
EUP
Direct Materials
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