Toy King Manufacturing Company produces a plastic toy in a two-stage molding and finishing operation. The company uses the weighted average method of process costing. During June, the following data were recorded for the Finishing Department. Units of beginning work in process inventory Percentage of completion of beginning inventory Cost of direct materials in beginning work in 10,000 25% process Units started Units completed Units in ending work in process inventory Percentage of completion of ending units Spoiled units Cost added during current period: 70,000 50,000 20,000 95% 10,000 Direct materials Direct labor P655,200 P635,600 P616,000 Manufacturing overhead Work in process, beginning: Transferred In costs Conversion costs P82,900 P42,000 P647,500 Costs of units transferred In during current period Conversion costs are incurred evenly during the process. Direct materials costs are incurred when production is 90% complete. The inspection point is at 80% stage of production. Normal spoilage is 10% of all good units that pass inspection. 12.What are the equivalent units of production for direct materials and conversion costs? Direct Materials Conversion costs a. 70,000 b. 50,000 60,000 d. 77,000 69,000 77,000 75,000 с. 70,000
Toy King Manufacturing Company produces a plastic toy in a two-stage molding and finishing operation. The company uses the weighted average method of process costing. During June, the following data were recorded for the Finishing Department. Units of beginning work in process inventory Percentage of completion of beginning inventory Cost of direct materials in beginning work in 10,000 25% process Units started Units completed Units in ending work in process inventory Percentage of completion of ending units Spoiled units Cost added during current period: 70,000 50,000 20,000 95% 10,000 Direct materials Direct labor P655,200 P635,600 P616,000 Manufacturing overhead Work in process, beginning: Transferred In costs Conversion costs P82,900 P42,000 P647,500 Costs of units transferred In during current period Conversion costs are incurred evenly during the process. Direct materials costs are incurred when production is 90% complete. The inspection point is at 80% stage of production. Normal spoilage is 10% of all good units that pass inspection. 12.What are the equivalent units of production for direct materials and conversion costs? Direct Materials Conversion costs a. 70,000 b. 50,000 60,000 d. 77,000 69,000 77,000 75,000 с. 70,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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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:Toy King Manufacturing Company produces a plastic toy in a two-stage molding and
finishing operation. The company uses the weighted average method of process
costing. During June, the following data were recorded for the Finishing Department.
Units of beginning work in process inventory
Percentage of completion of beginning inventory
Cost of direct materials in beginning work in
10,000
25%
process
Units started
70,000
50,000
20,000
95%
10,000
Units completed
Units in ending work in process inventory
Percentage of completion of ending units
Spoiled units
Cost added during current period:
Direct materials
Direct labor
Manufacturing overhead
Work in process, beginning:
Transferred In costs
Conversion costs
P655,200
P635,600
P616,000
P82,900
P42,000
P647,500
Costs of units transferred In during current period
Conversion costs are incurred evenly during the process. Direct materials costs are
incurred when production is 90% complete. The inspection point is at 80% stage of
production. Normal spoilage is 10% of all good units that pass inspection.
12.What are the equivalent units of production for direct materials and
conversion costs?
Direct Materials
Conversion costs
70,000
77,000
69,000
77,000
75,000
а.
b.
50,000
C.
60,000
d.
70,000
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