1
CHAPTER 10
Answers to Multiple Choice – Theoretical 1. 2. !. #. %.
b c b b b
6. . ". $. 10.
c c c c a
11.
d
&olutions to Multiple Choice – Co'putational
1.
(d)
Units started in process Units in process, end - Dept. 1 Units in process, end - Dept. 2 *nits trans+erred out to +inished ,oods 2.
(a)
Units in process, beginning Units placed in process Units in process, end *nits trans+erred out to ept. 2 !.
P6.00
(a)
Units transferred to finised goods (100!) nding *or+ in process (400 # 25!) E/uialent units o+ production 6.
(a)
%14,0$0 %14,0$0 & 4,400 ' .
29,000 2,400 !1-#00
(a)
%1$$,400 & "1,400 "1,400 ' %.
6,000 14,000 (4,200) 1%-"00
(a)
Units completed and transferred ot (100!) Units in process, end (",000 # $0!) E/uialent units o+ production – Materials #.
95,000 ( 21,000) ( 12,000) 62-000
P!.20
(a)
100 # %".20
'
P!20
4,"00 100 #-#00
2 ".
(a)
Units placed in prodction Units transferred ot to ne#t department *nits in endin, wor in process $.
(a)
Units transfe sferred ot to ne#t department (100!) Units in ending *or+ in process (6,000 # 1&") E/uialent units o+ production – oerhead 10.
",000 (6,000) 6-000
6,000 2,000 6$-000
(b)
%2$2,900 & 69,000 ' %4.10 # 6,000 ' P2#-00. 11.
(a)
2,000 U% # %4 %4.10 12.
1!.
P"-200
(a)
Units completed and transferred ot (100!) Units completed and on and (100!) Units in ending *or+ in process (200 # 65!) ialent nits of prodction
",620 $0 1"0 ",$"0
Unit cost ' (%2,19" & ",$"0)
%.10
abor abor ost o+ units units trans trans+er +erred red out3 out3 (!-620 (!-620 4 P.10 P.10))
P2%-0 P2%-02 2
(a)
$0 # %.10 1#.
'
'
P%6"
(a)
Units started into prodction Units completed *nits in process- end 1%.
",900 ",00 200
(a)
1"0 # %.10 16.
(a)
/aterials are added in Department 1. 1.
(c )
Units transferred ot to finised goods (1 (100!) Units in process, end (1$,600 # 2!) E/ui E/ uia ale lent nt unit unitss o+ o+ pro produ duct ctio ion n – con cone ers rsio ion n cos costt
61,400 1","92 #- #-$2 $2
" 1".
(b)
Equivalent units of production: production: Units finised and transferred to finised goods Units in process, end (9,000 # "5!) U%
2$,000 ",150 "1,250
Unit cost: ransferred in cost (% (%24,050 & ",000) is department (%1$,690 & "1,150) Units in process, end: ransferred in cost (9,000 # %0.65) ost tis department (",150 # %0.60) Cost o+ units in process- end 1$.
21.
%5,$50 1,$90 P-#0
(b)
Equivalent units of production: production: Materials: Units finised and transferred ot nding *or+ in process U%
4$,000 12,000 60,000
Conversion cost: Units finised and transferred ot nding *or+ in process (12,000 # 0!) U%
4$,000 $,400 56,400
Unit costs: ransferred in cost (%24,50 & 55,000) is department /aterials3 (%,200 & 60,000) (%5",5$0 & 56,400) Total unit cost 20.
%0.65 0.60
%0.45 %0.12 0.95
0.95 P1-%2
(b) ialent nits of prodction Materials: Units transferred ot (15,000 ",000) Units in process, end U%
12,000 -012,000
Conversion cost: Units transferred ot Units in process, end (",000 # 2&") U%
12,000 2,000 14,000
Cost of units transferred out: ransferred in3 (%1",500 & 15,000) /aterials (12,000 # 4 # %.02) ' %960 & 12,000 onersion cost (%14,210 & 14,000) otal nit cost Cost o+ units trans+erred out3 (12-000 4 P1.$$%)
%0.90 0.0$ 1.015 %1,995 P2!-$#0
(d)
4
Equivalent units of production: production: /aterials Units transferred ot to finised goods nding nits in process 10! # 0,000 ' ,000 40! # 0,000 ' 2$,000 15! # 0,000 ' 10,500 "5! # 0,000 ' 24,500 U% onersion cost Units transferred ot to finised goods nding nits process ,000 # "0! 2$,000 # 60! 10,500 # 5! 24,500 # $5! U%
22.
5"0,000 -0 -0 10,500 24,500
"5,000 565,000
5"0,000 2,100 16,$00 ,$5 20,$25
4,600 5,600
Unit cost: ransferred in (%"00,000 & 500,000) /aterials (%559,"50 & 565,000) onersion cost (%606,4$0 & 5,600) otal nit cost
% . 60 .99 1.05 %2.64
Cost of ending work in process: ransferred in (0,000 # %0.60) /aterials ("5,000 # %0.99) onersion cost (4,600 # %1.05) Total
% 42,000 "4,650 49,9$0 P126-6!0
(a)
ransferred in cost (" ("2,000 # %$."9( ost added Direct labor (2 ( 20,000 # %".19) eread (20,000 # %1.20) Cost to account +or
%26$,4$0 %6",$00 24,000
$,$00 P!%6-2"0
5 2!.
(b)
Unit Unit cost cost from from prec preced edin ing g depa depart rtme ment nt (%"9 (%"91, 1,50 500 0 & $," $,"00 00)) Unit cost tis department Direct materials % 1.2" onersion costs 2.50 otal nit costs otal nits to accont for Units transferred in (%50$,959 & %$.") Units in process, end otal cost to accont for Units transferred to finised goods Units in process, end rans ransfe ferr rred ed in cost cost (20, (20,00 000 0 # %5.0 %5.00) 0) ost added tis department D/ (20,000 # %1.2") (2 (20,000 # 45!) # %2.50 Total cost to account +or
2#.
5.00 5.00
%
"." $." $,"00 5$,"00 20,000
%50$,959 %100 %100,0 ,000 00 24,600 22,500
14,100 P6%6-0%$
(a)
%1,4$0,000 & 10,000 nits '
2%.
%
P1#"
(a)
ialent nits of prodction Materials: Units completed Units in process, end U% Conversion cost: Units completed Units in process, end (1,000 #50!) U% Unit costs: /aterials (%20,000 & 10,000) onersion cost (60,000 & 9,500)
9,000 1,000 10,000
9,000 500 9,500
P2 "0
6
26.
(a)
ialent nits of prodction Materials: ompleted and transferred ot nding *or+ in process emical % (15,000 # 100!) emical U%
2.
Che'ical P
Che'ical 5
"5,000
"5,000
15,000 50,000
- 0 "5,000
Conversion cost: ompleted and transferred ot nding *or+ and process3 (15,000 # 2&") U%
"5,000 10,000 45,000
Unit costs: /aterials emical % (%250,000 & 50,000) emical (%0,000 & "5,000) onersion cost (%1"5,000 & 45,000) otal nit cost
% 5.00 2.00 ".00 %10,00
Co'pleted and trans+erred out3 (!%-000 4 P10)
P!%0-000
(a)
nding *or+ in process /aterials emical % (15,000 # %5) onersion cost (10,000 # %") Cost o+ endin, wor in process
% 5,000 "0,000 P10%-000
&olutions to Proble's
Proble' 101
D Units started in process Units transferred in Units to accont for ransferred to ne#t department ransferred to finised goods nding *or+ in process Units acconted for
%
7
8
1 10,000 10,000
2
(b) 4,000 4,000
(a) 4,000 6,000 10,000
",000 (c) 1,000 4,000
/ !
:
#
%
",000 ",000
(c) 2,400 2,400
(g) 2,100 2,100
(d) 2,400 600 ",000
(f) 2,100 "00 2,400
() 1,600 500 2,100
PR78EM 102 ept. A
ept. 8
ept. C
Materials: ransferred ot (100!) nding *or+ in process E*P
15,000 10,000 2%-000
12,000
9,000
12-000
$-000
Conversion cost: ransferred ot nding *or+ in process E*P
15,000 ,500 22-%00
12,000 1,500 1!-%00
9,000 900 $-$00
Proble' 10! Materials: Units transferred ot (50,000 10,000) Units in process, end 10,000 # 25! ' 2,500 # 20! 10,000 # "0! ' ",000 # 50! 10,000 # 25! ' 2,500 # $0! 10,000 # 20! ' 2,000 # 100! E*P Conversion cost: Units transferred ot Units in process, end 2,500 # "5! ",000 # 55! 2,500 # $0! 2,000 # 95! E*P
40,000 500 1,500 2,000 2,000
6,000 #6-000
40,000 $5 1,650 2,000 1,900
6,425 #6-#2%
$ Proble' 10#
1.
2.
E/uialent units o+ production Materials: Units transferred ot (1",000 2,000) Units in process, end U%
11,000 - 0 11,000
Conversion cost: Units transferred ot Units in process, end (2,000 # 45!) U%
11,000 900 11,900
epart'ent 2 Cost o+ Production Report Month o+ 9ul: !1- 2010
Quantity Schedule: ransferred in
Units 1",000
ransferred ot ;or+ in process, end otal acconted for
11,000 2,000 1",000
Cost Schedule ost transferred in ost added in tis dept. /aterials otal cost to accont for
Total Cost %16,120
ost acconted for ransferred ot ;or+ in process, end ost transferred in ost added otal cost acconted for
<
EU 1",000
Unit Cost ' %1.24
2,$60 9,996 %2$,96
< <
11,000 11,900
' '
0.26 0.$4 %2."4
%25,40
'
11,000
#
%2."4
2,4$0
'
2,000
#
1.24
56 %2$,96
'
900
#
0.$4
9 Proble' 10% 1.
2.
E/uialent *nits o+ Production Materials: Units transferred ot (100 !) nding nits in process U%
ept. 1
ept. 2
60,000 15,000 5,000
55,000 -055,000
Conversion cost: Units transferred ot nding nits in process U%
60,000 9,000 69,000
55,000 4,000 59,000
epart'ent 1 Cost o+ Production Report Month o+ 9anuar:- 2010
Quantity Schedule Units started in process
Units 5,000
Units transferred ot Units in process, end otal acconted for
60,000 15,000 5,000
Cost Schedule Direct materials onersion costs otal cost to accont for
Total Cost %"00,000 25$,50 %55$,50
EU < 5,000 < 69,000
' '
ransferred ot Units in process, end /aterials otal acconted for
%465,000
' 60,000
#
%.5
60,000 "",50 %55$,50
' 15,000 ' 9,000
# #
4.00 ".5
Unit Cost %4.00 ".5 %.5
epart'ent 2 Cost o+ Production Report Month o+ 9anuar:- 2010
Quantity Schedule Units transferred in
Units 60,000
Units transferred ot Units in process, end otal acconted for
55,000 5,000 60,000
Cost Schedule ransferred in cost ost added tis department otal cost to accont for
Total Cost %465,000 24"," ,"5 %0$,"5
< <
EU Unit Cost 60,000 ' % .5 59,000 ' 4.125 %11.$5
ransferred ot Units in process, end ransferred in ost added otal acconted for
%65",125
'
55,000 #
%11.$5
"$,50 16,500 %0$,"5
' '
5,000 # 4,000 #
.5 4.125
10 Proble' 106 (1)
E/uialent *nits o+ Production Materials: Units transferred ot Units in process, end U%
Conversion Costs Units transferred ot Units in process, end U% (2)
ept. 1
ept. 2
ept. !
125,000 25,000 150,000
115,000 - 0 115,000
112,000 - 0 112,000
125,000 10,000 1"5,000
115,000 1,000 116,000
112,000 2,00 114,00
Cost o+ Production ion Reports3 epart'ent 13 Quantity Schedule :tarted in process
Units 150,000
ransferred ot nding *or+ in process otal acconted for
125,000 25,000 150,000
Cost Schedule /aterials onersion costs otal cost to accont for
Total Cost %21,000 24,"00 %45,"00
ransferred ot nding *or+ in process /aterials onersion cost otal acconted for epart'ent 2 Quantity Schedule ransferred in
Units 125,000
ransferred ot nding *or+ in process otal acconted for
115,000 10,000 125,000
Cost Schedule ransferred in cost ost added tis department onersion cost otal cost to accont for
Total Cost %40,000
ransferred ot nding *or+ in process ransferred in cost ost added tis dept. otal acconted for
< <
EU 150,000 ' 1"5,000 '
Unit Cost %0.14 0.1$ %0."2
%40,000
'
125,000
#
%0."2
",500 1,$00 %45,"00
' '
25,000 10 10,000
# #
0.14 0.1$
<
EU Unit Cost 125,000 ' %0 % 0."2
"4,$00 %4,$00
<
116,000 '
0."0 %0.62
%1,"00
'
115,000 '
%0.62
",200 "00 %4,$00
' '
10,000 ' 1,000 '
0."2 0."0
11
Problem 10-6 (continued): epart'ent ! Quantity Schedule ransferred in
Units 115,000
ransferred ot nding *or+ in process otal acconted for
112,000 ",000 115,000
Cost Schedule ransferred in cost ost added tis department otal cost to accont for
Total cost %1,"00 < 24,0$ < %95,"$
EU 115,000 ' 114,00 '
ransferred ot to finised goods nding *or+ in process ransferred in cost ost added tis dept. otal acconted for
%92,960
'
112,000 #
%0.$"
1,$60 56 %95,"$
' '
",000 # 2,00 #
0.62 0.21
Unit Cost %0.62 0.21 %0.$"
Proble' 10 1.
E/uialent *nits o+ Production Materials: ransferred ot ompleted and on and nding *or+ in process U%
Conversion cost: ransferred ot ompleted and on and nding *or+ in process U% 2.
ept. 1
ept. 2
15,000 $,000 2",000
,000 1,000 - 0$,000
15,000 6,500 21,500
,000 1,000 5,250 1",250
Cost o+ Production Report epart'ent 1 Quantity Schedule :tarted in process
Units 25,000
ransferred ot nding *or+ in process otal acconted for
15,000 10,000 25,000
Cost Schedule Direct materials onersion cost otal cost to accont for
Total Cost %12,650 < 1$,05 < %"1,"55
EU 2",000 21,500
' '
ransferred ot nding *or+ in process D/
%21,"00 4,400 5,655
15,000 $,000 6,500
# # #
' ' '
Unit Cost %0.55 0.$ %1.42 %1.42 0.55 0.$
12 otal acconted for Problem 10-7 (Continued)
%"1,"55
epart'ent 2
Quantity Schedule ransferred in
Units 15,000
ransferred ot to finised goods ompleted and on and nding *or+ in process otal acconted for
,000 1,000 ,000 15,000
Cost Schedule ransferred in cost ost added tis department otal cost to accont for
Total Cost %21,"00 16,4"0 %","0
rans ransfe ferrred red ot to fini finis sed ed good goodss ompleted and on and nding *or+ in process ransferred in cost ost added tis dept. otal acconted for
< <
EU 15 1 5,000 1",250 1",250
Unit Cost % 1.42 1.24 % 2.66
' '
%1$ %1$,620 ,620 2,660
' '
,00 ,000 0 1,000
# #
% 2.66 .66 2.66
9,940 6,510 %","0
' '
,000 5,25 ,250
# #
1.42 1.24 .24
Proble' 10" 1.
E/uialent *nits o+ Production3 Materials: ransferred ot nding nits in process 50,000 # "0! ' 15,000 50,000 # "5! ' 1,500 50,000 # 15! ' ,500 50,000 # 20! ' 10,000 U% Conversion Cost: ransferred ot nding nits in process 15,000 # 45! 1,500 # 50! , ,500 # 65! 10,000 # 9$! U%
2.
101 250,000
102 250,000
10! 250,000
10# 250,000
15,000 1,500 ,500 10,000 "00,000
15,000 1,500 ,500 10,00 ,000 "00,000
,500 10,000 1,500
10,000 10,000
250,000 6,50 $,50 4,$5 9,$00 2$0,15
*nit costs3 /aterials 101 (% (%6,000 & "00,000) %0.02 102 (% (%",000 & "00,000) 0.01 10" (%9 (%9,"6 ,"62.50 & 26,500) 0.0"5 104 (%1",000 & 260,000) 0.05 onersion cost (% ( %11,6".50 & 2$0,15) otal nit costs
%0.115 0.42 %0.5"5
1"
Problem 10-8 (Continued): Cost of ending wor in !rocess inventor": /aterials 101 (50,000 # %0.02) 102 (50,000 # %0.01) 10" (1,500 # %0.0"5) 104 (10,000 # %0.05) otal onersion cost (" ( "0,15 # %0.42) otal cost
% 1,000.00 500.00 612.50 500.00 % 2,612.50 12,6".50 %15,2$6.00
Proble' 10$
1.
E/uialent *nits o+ Production3 Asse'bl: epart'ent3 Materials: ransferred ot to ne#t department nding *or+ in process (100!) U%
1,$60 140 2,000
Conversion cost: ransferred ot nding *or+ in process (140 # 5!) U%
1,$60 105 1,965
;inishin, epart'ent3 Materials and overhead: ransferred ot to finised goods nding *or+ in process (60 # 40!) U%
1,$00 24 1,$24
!a"or: ransferred ot to finised goods nding *or+ in process (60 # 10!) U%
1,$00 6 1,$06
14
2.
Pen Peninsu insula la Co'p o'pan: an: – Asse'b se'bl: l: epar epartt'en 'ent Cost o+ Production Report Month o+ Au,ust
Quantity Schedule :tarted in process
Units 2,000
ransferred o ot to to ne ne#t de departme tment ;or+ in process, end otal acconted for
1,$6 ,$60 140 2,000
Cost Schedule /aterials =abor eread otal cost to accont for
Total Cost %"0,000.00 < 29,60.00 < 1$,$"0.00 < %$,500.00
EU 2,000 1,965 1,965
' ' '
Unit Cost %15.00 15.10 9.5$ %"9.6$
ransferred ot to ne#t departme tment ;or+ in process, end /aterials =abor eread otal *or+ in process otal cost acconted for #$ ad%ust&ent for rounding'
%",$0 ,$0$.00> '
1.$60
#
%"9.6$
140 10 105 10 105
# # #
15.00 15 15.10 9.5$
2,100.00 1,5$6.00 1,006.00 4,692.00 %$,500.00
' ' '
Peninsula Co'pan: – ;inishin, epart'ent Cost o+ Production Report Month o+ Au,ust
Quantity Schedule rans ransfe ferr rred ed in from from prio priorr depa depart rtme ment nt
Units 1,$6 1,$60 0
ransferred o ot to to fi finised go goods ;or+ in process, end otal acconted for
1,$00 60 1,$60
Cost Schedule rans ransfe ferr rred ed in cost cost from from prio priorr dept dept.. ost added tis department /aterials =abor eread otal cost to accont for
Total Cost % ",$ ",$0$ 0$.0 .00 0
rans ransfe ferrred red ot to fini finis sed ed good goodss ;or+ in process, end ransferred in cost ost added tis dept. /aterials =abor eread otal otal cost cost of *or+ *or+ in proc proces esss otal costs acconted for
%15 %159,$ 9,$4 4.00> .00> '
6$,000.00 1",660.00 ,$25.00 %16",29$.00
<
EU 1,$6 1,$60 0
Unit Cost ' %"9. %"9.6$ 6$
< < <
$2 $24 1,$06 1,$24
' ' '
".2$ .5 4.29 %$$.$2
1,$0 ,$00
#
%$$ %$$.$2 .$2
2,"$1.00
'
60
#
"9.6$
$95.00 45.00 10".00 ",42 ",424. 4.00 00 %16",29$.00
' ' '
24 6 24
# # #
" ".2$ . .5 4.29
15
!.
#.
%.
#( )ounding ad%ust&ent ;or+ in process 7ssembl? Department ;or+ in process @inising Department /aterials @actor? pa?roll @actor? oeread control To record allocation of production cost' ;or+ in process @inising Department ;or+ in process 7ssembl? Department To record transfer of goods fro& *sse&"ly to +inishing epart&ent' @inised goods ;or+ in process @inising Department To record co&pletion of goods transferred to finished -oods inventory'
$,500 $9,490 9$,000 4",""0 26,660
",$0$ ",$0$
159,$4 159,$4
Proble' Proble ' 1010 1.
E/uialent *nits o+ Production Tri''in, epart'ent
Asse'bl: epart'ent
;inishin, epart'ent
Materials3 ransferred ot ;or+ in process, end U%
5,400 600 6,000
5,000 "$0 5,"$0
4,$00 160 4,960
abor ransferred ot ;or+ in process, end U%
5,400 "60 5,60
5,000 "00 5,"00
4,$00 1$0 4,9$0
7erhead ransferred ot ;or+ in process, end U%
5,400 "60 5,60
5,000 "40 5,"40
4,$00 160 4,960
16
2.
Tri''in, epart'ent Cost o+ Production Report Month o+ 9une- 2010
Quantity Schedule :tarted in process
Units 6,000
ransferred o ot to to ne ne#t de departme tment ;or+ in process, end otal acconted for
5,40 ,400 600 6,000
Cost Schedule /aterials =abor eread otal costs to accont for
Total Cost %"",600 1$,500 9,21 %61,"1
rans ransfe ferr rred ed ot ot to ne#t ne#t depa depart rtme ment nt ;or+ in process, end /aterials =abor eread otal *or+ in process otal costs acconted for
< < <
EU 6,000 5,60 5,60
' ' '
Unit Cost % 5.60 ".211$0 1.6001 %10.4119
%56, %56,22 225 5
'
5,40 5,400 0
#
%10.4 %10.41 119 19
","60 1,156 56 5,092 %61,"1
' ' '
600 "60 "60
# # #
5.60 ".211$0 1.6001
<
EU 5,400 '
Unit Cost %10.4120"
< < <
5,"$0 5,"00 5,"40
".1200 2.$0 1.""""" %1.6654"
Asse'bl: epart'ent Cost o+ Production Report Month o+ 9une- 2010
Quantity Schedule rans ransfe ferr rred ed in from from prio priorr depa depart rtme ment nt
Units 5,40 5,400 0
ransferred o ot to to ne ne#t de departme tment ;or+ in process, end otal acconted for
5,00 ,000 400 5,400
Cost Schedule ransferred in cost ost added tis department /aterials =abor eread otal costs to accont for
Total Cost %56,225
rans ransfe ferrred red ot to ne#t ne#t depa epartm rtment ent ;or+ in process, end ransferred in cost ost added tis department /aterials =abor eread otal *or+ in process otal costs acconted for
16,$6 14,$40 ,120 %94,91 %$$ %$$,"2$ ,"2$> >
'
5,0 5,000
' ' '
#
%1. %1.66 6654 54" "
4,164
'
400
#
10.4120"
1,1$6 $40 45" 6,64" %94,91
' ' '
"$0 "50 "40
# # #
".1200 2. 2.$0 1. 1."""""
1 . difference due to rounding rounding
;inishin, epart'ent Cost o+ Production Report Month o+ 9une- 2010
Quantity Schedule rans ransfe ferr rred ed in from from prio priorr depa depart rtme ment nt
Units 5,00 5,000 0
ransferred o ot to to fi finised go goods ;or+ in process, end otal acconted for
4,$00 200 5,000
Cost Schedule rans ransfe ferr rred ed in cost cost from from prio priorr dept dept.. ost added tis department /aterials =abor eread otal costs to be acconted for
Total Cost % $$," $$,"2$ 2$
rans ransfe ferr rred ed ot to fini finis sed ed good oods ;or+ in process, end ransferred in cost ost added tis department /aterials =abor eread otal *or+ in process otal costs acconted for
!a.
!b.
!c.
!c.
<
EU 5,00 5,000 0
'
6,400 10,"20 4,960 %110,00$
< < <
4,960 4,9$0 4,960
' ' '
1.290"2 2.022$ 1.00 %22.02$20
%10 %105," 5,"5 5
'
4,$0 4,$00 0
#
%22. %22.02 029 920
",5""
'
200
#
1.66560
20 "" 160 4,2" %110,00$
' ' '
16 160 1$0 160
# # A
1.290"2 2.022$ 1.00
;or+ in process rimming Department ;or+ in process 7ssembl? Department ;or+ in process @inising Department /aterials @actor? pa?roll @actor? oeread control To record &anufacturing costs'
Unit Cost %1. %1.66 6656 560 0
61,"1 "$,46 21,6$0
;or+ in process 7ssembl? Department 56,225 ;or+ in process rimming Department To record transfer of goods fro& Tri&&ing to *sse&"ly epart&ent' ;or+ in process @inising Department $$,"2$ ;or+ in process 7ssembl? Department To record transfer of goods fro& *sse&"ly To +inishing epart&ent' @inised goods B 105,"5 ;or+ in process @inising Department o record completion of finised goods.
56,$6 4",660 21,29
56,225
$$,"2$
105,"5
