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Process-Costing-EUP-quiz-1 Accounting 223 is primarily

devoted to the understanding of the different elements of
production costs, the manner in which they are recognized,
Cost accounting part 1 (University of Cebu)
measured, recorded, and summarized for inventory valuation
and income determination

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UNIVERSITY OF CEBU-BANILAD
COLLEGE OF ACCOUNTANCY
BANILAD, CEBU CITY
Accounting 108 (Process Costing – EUP)
Name ________________________________ Course & yr. __________ Schedule _______________ Score __________

I – Multiple choice. Encircle the letter of the best answer in each of the given statement/s.

1. Which of the industries listed below is most likely to use process costing in accounting for production costs?
a. Road builder b. Electrical contractor c. Newspaper publisher d. Automobile repair shop
2. Which of the following characteristics applies to process costing but not to job-order costing?
a. Identifiable batches of production c. Averaging process
b. Equivalent units of production d. Use of standard costs
3. An equivalent unit of direct materials or conversion cost is equal to
a. The amount of direct materials or conversion cost necessary to complete one unit of production.
b. A unit of work-in-process inventory
c. The amount of direct materials or conversion cost necessary to start a unit of production in work-in-process.
d. Fifty percent of the direct materials or conversion cost of a unit of finished goods inventory (assuming a linear
production pattern)
4. In the computation of manufacturing cost per equivalent unit, the weighted-average method of process costing considers
a. Current costs only
b. Current cost plus cost of beginning work-in-process inventory
c. Current costs plus cost of ending work-in-process inventory
d. Current costs minus cost of beginning work-in-process inventory
5. An error was made in the computation of the percentage of completion of the current year’s ending work-in-process
(EWIP) inventory. The error resulted in assigning a lower percentage of completion to each component of the inventory
than actually was the case. Consequently, the following were misstated:
1. The computation of total equivalent units
2. The computation of costs per equivalent unit
3. Costs assigned to cost of goods completed for the period
What were the effects of the error?
1 2 3
a. Understate Overstate Overstate
b. Understate Understate Overstate
c. Overstate Understate Understate
d. Overstate Overstate Understate
6. In a process-costing system, the application of factory overhead usually is recorded as an increase
a. Cost of goods sold c. Factory overhead control
b. Work-in-process inventory control d. Finished goods control
7. The completion of goods is recorded as a decrease in work-in-process control when using
Job-order Costing Process Costing
a. Yes No
b. Yes Yes
c. No Yes
d. No No
8. Equivalent units of production are used in process accounting to
a. Measure the efficiency of the production process.
b. Establish standard costs
c. Provide a means of allocating cost to partially completed units
d. Allocate overhead to production
9. In process 2, material G is added when a batch is 60% complete. Ending work-in-process units, which are 50% complete,
would be included in the computation of equivalent units for
Conversion costs Material G Conversion costs Material G
a. Yes No c. No No
b. No Yes d. Yes Yes
10. Assuming no beginning work-in-process inventory, and that the ending work-in-process inventory is 100% complete as
to materials costs, the number of equivalent units as to materials costs is
a. The same as the units placed in process c. Less than the units placed in process
b. The same as the units completed d. Less than the units completed

Questions 11 through 14 are related to the following list of nine concepts:

1. EUP to complete BWIP.
2. EUP from last period in BWIP.
3. Units transferred in.
4. Total units transferred out.
5. Units transferred out that were started and completed this period.
6. Units transferred out that were started last period and completed this period.
7. EUP to complete EWIP.
8. EUP completed in EWIP.
9. Total units in BWIP.

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11. What is a correct formula for weighted-average EUP?

a. 1 + 2 + 3 + 7 b. 2 + 4 – 8 c. 1 + 2 + 3 – 7 d. 4 + 5 + 6 + 8
12. What is another correct formula for weighted-average EUP?
a. 8 + 6 + 5 b. 8 + 4 + 2 + 1 c. 8 + 7 + 4 + 2 d. 8 + 6 + 5 – 2
13. What is the correct formula for FIFO EUP?
a. 1 + 3 – 7 b. 1 + 2 + 3 – 8 c. 1 + 4 – 7 d. 9 – 5 – 6
14. What is another correct formula for FIFO EUP?
a. 8 + 4 b. 8 + 4 – 2 c. 8 + 7 + 6 + 5 d. 7 + 4 + 2 + 1
15. Assuming no beginning work in process inventory, and that the ending work in process inventory is 100% complete as
to materials costs, the number of equivalent units as to material costs is
a. The same as the units placed in process c. Less than the units placed in process
b. The same as the units completed d. Less than the units completed
16. One approach to calculating EUP is to begin with the total work that could be done, i.e., the units in BWIP and those
transferred in. Is there another approach?
a. Yes, begin with the total work that could not be done, e.g., work already completed in BWIP.
b. Yes, begin with the total work that has been done (units transferred out and the completed EUP in EWIP).
c. Yes, begin with the total work that has been done (units transferred out and the EUP required to complete EWIP).
d. No, EUP may be calculated in only one way.
17. The units transferred in from the first department to the second department should be included in the computation of the
equivalent units for the second department under which of the following methods of process costing?
FIFO Weighted-Average FIFO Weighted-Average
a. Yes Yes c. No Yes
b. Yes No d. No No
18. Materials are added at the beginning of a process in a process-costing system. The BWIP for the process this period was
30% complete as to conversion costs. Using the FIFO method of costing, the number of equivalent units of materials
for the process during this period is equal to the
a. Beginning Inventory this period for the process
b. Units started this period in the process
c. Units started this period in the process plus beginning inventory
d. Units started this period in the process plus 70% of the beginning inventory this period
19. An equivalent unit of direct materials or conversion cost is equal to
a. The amount of direct materials or conversion cost necessary to complete one unit of production.
b. A unit of work-in-process inventory.
c. The amount of direct materials or conversion cost necessary to complete one unit of production in work in process.
d. Fifty percent of the direct materials or conversion cost of a unit of finished goods inventory (assuming a linear
production pattern).
20. Equivalent units of production are used in process accounting to
a. Measure the efficiency of the production process c. Provide a means of allocating cost to partially completed units
b. Establish standard costs d. Allocate overhead to production

II – Problem Solving. Give the requirements accordingly with supporting computation/s.

A. Crew Co. Had 3,000 units in work-in-process at April 1 that were 60% complete as to conversion costs. During April,
10,000 units were completed. At April 30, the 4,000 units in work-in-process were 40% complete as to conversion cost.
Direct materials are added at beginning of the process. How many units were started during April? ______________

B. On November 1, Yankee Company had 20,000 units of WIP in Department No. 1 which were 100% complete as to
material costs and 20% completed as to conversion costs. During November, 160,000 units were started in Department
No. 1 and 170,000 units were completed and transferred to Department No. 2. WIP on November 30 was 100%
complete as to materials costs and 40% complete as to conversion costs. By what amount would be equivalent units for
conversion costs for the month of November decrease if the FIFO method were used instead of the weighted-average
method? __________________

C. The following data pertain to a company’s cracking department operations in December:

Units Completion
WIP, Dec. 1 20,000 50%
Units started 170,000
Completed & transferred 180,000
WIP, December 31 10,000 50%
Materials are added at the beginning of the process and conversion costs are incurred uniformly throughout the process.
Assuming the use of FIFO method of process costing, compute the equivalent units of conversion _____________ and
in materials ______________.

D. With a beginning inventory of 20,000 units in work in process that were 30% complete, a hard goods manufacturer
completed 190,000 units in 2008 and finished the year with 15,000 units in work in process that were only 20%
complete.
Using the FIFO method, what is the number of equivalent unit of production? ___________________

E. A company produces plastic drinking cups and uses a process cost system. Cups go through three departments: mixing,
molding, and packaging. During the month of June, the following information is known about the mixing department:
WIP, June 1 (75%) 10,000 units

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Completed during June 140,000 units

WIP, June 30 (25%) 20,000 units
Materials are added at two points in the process. Material A is added at the beginning of the process and Material B at
the midpoint of the mixing process. Conversion costs are incurred uniformly throughout the mixing process.

Required: Assuming a FIFO costing flow, compute the equivalent units for
Material A ___________ Material B _______________ Conversion cost ______________

F. Direct materials are added at the start of a manufacturing process, and conversion costs are incurred evenly throughout.
Work in process inventory on May 1 consisted of 10,000 units 40% complete. These units were completed in May. In
addition, 100,000 units were started in May and 80,000 were completed. The remaining 20,000 units were 70% on May
31.
Required: EUP for conversion during May under FIFO ___________________

G. Kew Co. Had 3,000 units in work in process at April 1 that were 60% complete as to conversion cost. During April,
10,000 units were completed. At April 30, the 4,000 units in work in process were 40% complete as to conversion cost.
Direct materials are added at the beginning of the process.
Required: How many units were started during April? _________________

H. Walden Company has a process-cost system using the FIFO cost method. All materials are introduced at the beginning
of the process in Department One. The following information is available for the month of January:

WIP, January 1 (40% complete as to conversion costs) 500

Started 2,000
Transferred to Department two 2,100
WIP, January 31 (25% complete as to conversion costs) 400
Required: Compute the EUP under
1. Weighted average
Materials ______________ Conversion ______________
2. FIFO Materials ________________

I. The Wilson Company manufactures the famous Ticktock watch on an assembly-line basis. January 1 work in process
consisted of 5,000 units partially completed. During the month an additional 110,000 units were started and 105,000
units were completed. The ending work in process was 60% complete as to conversion costs. Conversion costs are
added evenly throughout the process. The following conversion costs were incurred:
Beginning costs for work in process P1,500
Total current conversion costs 273,920
The conversion costs assigned to ending work in process totalled P15,360 using the FIFO method of process costing.
Required: What was the percentage of completion as to conversion costs of the units in BWIP? _______________

J. Compute the equivalent units of production from 1 to 4 under FIFO and Weighted Average Method.

1. In process, beginning:
1/8 completed 4,000 units
¾ incomplete 6,000 units
Started in process 25,000 units
Finished and transferred 20,000 units
In process, ending 1/6 completed ?

FIFO _________________ Weighted Average _____________

2. In process, beginning
2/5 completed 40,000 units
3/5 completed 40,000 units
2/5 completed 20,000 units
Started in process 160,000 units
Finished and transferred 180,000 units
In process end, ½ is 4/5 completed
and the balance is ½ completed

FIFO _________________ Weighted Average _____________

3. Started in process 48,000 units

In process, ending ¾ incomplete 32,000 units
(Of the finished and transferred units
3/5 represent work in process beg.
which were 2/3 completed during the
current period).

FIFO _________________ Weighted Average _____________

4. In process, beginning 5/8 completed ?

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Started in process 20,000 units

Finished and transferred out 16,000 units
Finished and on hand 3,200 units
In process, ending 4/5 completed 32,800

FIFO _________________ Weighted Average _____________

K. Khalyl Inc., uses process costing to account for the costs of its only Product DMN. Production takes place in three
departments: Fabrication, Assembly and Packaging. At the end of the fiscal year, June 30 the following inventory of
Product DMN is on hand:
1. No unused raw materials or packaging material.
2. Fabrication Department : 300 units, 1/3 complete as to raw material and ½ complete as to direct labor.
3. Assembly Department : 1,000 units 2/5 complete as to direct labor.
4. Packaging Department : 100 units ¾ complete as to packaging materials and ¼ complete as to direct labor.
5. Shipping Area : 400 units.

Required: Using FIFO method of costing, compute the following:

1. The number of equivalent units of raw materials in all inventories at June 30 _______________
2. The number of equivalent units of fabrication department direct labor in all inventories at June 30
________________
3. The number of equivalent units of packing material in all inventories at June 30 ______________

L. Following are the data of FORYOUROWN Manufacturing Company.

Departments
A B
In process, December 1 30,000 15,000
Stage of completion 40% 10%
Started in process 60,000 75,000
In process, December 31 ? 30,000
Stage of completion 60% 60%
Department A applies 20% of material at the start of the process, 30% when the process is ½ completed and the balance
at the end of the process.
Department B applies 60% of material at the start of the process, and 40% at the end of the process.
In both departments, conversion costs are applied uniformly throughout the process.

Required: Equivalent unit of production for:

Department A Department B
1. Materials ___________ ___________
2. Conversion ___________ ___________

M. The following data pertains to the Melting Department for August:

Units % of completion
In process, August 1 50,000 30%
Units started 225,000
Units finished and transferred 175,000
In process, August 31 100,000 80%

Material A is introduced at the end of the melting process and Material Q is added when the process 90% complete.
Conversion costs are incurred uniformly throughout the process.
Required: Compute equivalent units of production of the following for the month of August for
Material A _______________ Material Q ______________ Conversion ______________
N. Department M applies material on instalment basis describe below:
10% on the first day of the process
15% during the next three days
35% on the fifth day
40% during the last four days
The processing period in this department covers ten (10) days and conversion cost are applied uniformly.
The production for Department M showed the following:
In process, beginning 30% complete 60,000 units
Received from Department A 250,000 units
Finished and transferred 200,000 units
In process ending 8 days processed ?
Required: Compute EUP for Materials ________________ and Conversion _______________

O. In process, beginning ¼ incomplete ?

Started in process 36,000 units
In process, ending ¼ complete 12,000 units
(The remaining units represent 25% of the
total units completed)

Required: Compute the EUP under FIFO ________________

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Key
I–
1. C 11. C
2. B 12. A
3. A 13. A
4. B 14. B
5. A 15. A
6. B 16. B
7. B 17. A
8. C 18. B
9. A 19. A
10. A 20. C
II
A. 11,000
B. 4,000 decrease
C. Conversion 175,000
Materials 170,000
D. 187,000
E. Material A 150,000
Material B 130,000
Conversion 137,500
F. 100,000 units
G. 11,000
H. 1. Materials 2,500 units Conversion 2,200 units
2. FIFO Materials 2,000
I. 80%
J. FIFO Weighted Average
1. 20,500 22,500
2. 184,000 232,000
3. 32,000 48,000
4. 25,440 45,440
K. 1. 1,600
2. 1,650
3. 475
L. Dept. A Dept. B
Materials 76,500 69,000
Conversion 72,000 76,500

M. Material A 175,000
Material Q 175,000
Conversion 240,000

N. Materials 276,000
Conversion 270,000

O. 33,000

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