Chapter 21, Problem 21.5AP

(a)(1)

To determine

Process Costing: Process costing is method of cost accounting in which all the costs that are incurred production process are recorded. Output of one process becomes input for next process. This method is used to apply cost to similar products that are bulk-produced in uninterrupted manner.

Production Cost Report: A report which gives information about the total units produced and total cost incurred during the production process is called production cost report. This report is useful for the management of the company to take decision regarding production and the measure for cost control.

Equivalent Units of Production: It is a evaluation of the work completed during the period expressed in wholly finished units. Equivalent units of production includes the completed units of direct materials and conversion cost of beginning work in process, units completed and transferred out and ending work in process.

Unit Cost of Production: The cost production derived in terms of corresponding units of production is called unit cost of production.

To determine: The equivalent units of production for materials and conversion costs.

(2)

To determine

The unit cost of production for materials and conversion cost.

(3)

To determine

The cost to be assigned to the units transferred out and process for June.

(b)

To determine

To prepare: A production cost report for the month of July for the basketballs.