Chapter 3, Problem 20E

To determine

Concept introduction:

A process cost summary is a report of production that shows expenses, units produced, and costs allocated to the production units of the department. In other words, this is a report that gives summary all of the process and production activities of a department.

Work-in-progress (WIP) is a supply-chain management and production term telling partly finished goods in process of completion. WIP refers to the crude materials, overhead cost, and labour costs incurred for units that are at different stages of the production process. WIP is a part of the stock asset account on the balance sheet. These costs are later transferred to the finished goods account and ultimately to cost of sales.

Requirement 1:

The number of units in hand that were transferred out and which are in closing work in progress (WIP).

To determine

Concept introduction:

The amount of work completed or job work is generally depicted by equivalent unit of production. Manufacturer who possesses partially finished goods in hand at the end of the month. Partially finished goods and fully finished goods in terms of fully finished goods. In other words, for determining per unit cost underlying cost accounting is used.

Requirement 2:

To explain:

The number equivalent units for material for the month.

To determine

Concept introduction:

The amount of work completed or job work is generally depicted by equivalent unit of production. Manufacturer who possesses partially finished goods in hand at the end of the month. Partially finished goods and fully finished goods in terms of fully finished goods. In other words, for determining per unit cost underlying cost accounting is used.

Requirement 3:

To explain:

The number equivalent units for conversion for the month.

To determine

Concept introduction:

Per unit cost of production is represented by cost per equivalent production. It is determined by dividing by EUP with TC

Requirement 4:

To explain:

The cost per equivalent units for material for the month.

To determine

Concept introduction:

Per unit cost of production is represented by cost per equivalent production. It is determined by dividing by EUP with TC

Requirement 5:

To explain:

The cost per equivalent units for conversion for the month.

To determine

Concept introduction:

Per unit cost of production is represented by cost per equivalent production. It is determined by dividing by EUP with TC

Requirement 6:

To explain:

The total cost of goods transfer for the month.

To determine

Concept introduction:

Work-in-progress (WIP) is a supply-chain management and production term telling partly finished goods in process of completion. WIP refers to the crude materials, overhead cost, and labour costs incurred for units that are at different stages of the production process. WIP is a part of the stock asset account on the balance sheet. These costs are later transferred to the finished goods account and ultimately to cost of sales.

Requirement 7:

To explain:

The total cost of closing work in progress(WIP) for the month.