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  • PROCESS COSTING (Average and FIFO Method) : Units To Account For

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    This document outlines the process for calculating costs using average and FIFO costing methods in a manufacturing environment. It discusses: 1) Tracking units started, completed, transferred in/out, and remaining in work in process. 2) Calculating equivalent units of production using percentage complete or FIFO assumptions. 3) Accounting for total costs including direct materials, conversion costs, and beginning inventory. 4) Determining a cost per equivalent unit. 5) Ensuring total costs accounted for equal the starting costs plus any additional costs incurred.

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    PROCESS-COSTINGWA-and-FIFO

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    This document outlines the process for calculating costs using average and FIFO costing methods in a manufacturing environment. It discusses: 1) Tracking units started, completed, transferred in/out, and remaining in work in process. 2) Calculating equivalent units of production using percentage complete or FIFO assumptions. 3) Accounting for total costs including direct materials, conversion costs, and beginning inventory. 4) Determining a cost per equivalent unit. 5) Ensuring total costs accounted for equal the starting costs plus any additional costs incurred.

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    © All Rights Reserved
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    19 views2 pages

    PROCESS COSTING (Average and FIFO Method) : Units To Account For

    Uploaded by

    Douzo plays
    This document outlines the process for calculating costs using average and FIFO costing methods in a manufacturing environment. It discusses: 1) Tracking units started, completed, transferred in/out, and remaining in work in process. 2) Calculating equivalent units of production using percentage complete or FIFO assumptions. 3) Accounting for total costs including direct materials, conversion costs, and beginning inventory. 4) Determining a cost per equivalent unit. 5) Ensuring total costs accounted for equal the starting costs plus any additional costs incurred.

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    © All Rights Reserved
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    of 2

    PROCESS COSTING( Average and FIFO Method)

    1. Beginning Work in process


    Started-in/ Transferred-in
    Units to account for

    Completed and transferred out


    EQUAL
    Ending Work in process
    Lost(if any)
    Units accounted for

    2.
    Equivalent Units Production

    Completed and transferred out Beginning Work in process x % uncomp


    Plus: Ending Work in process x % comp or Plus:Started and completed
    Weighted Average- EUP Plus:Ending Work in process x % comp
    Less: Beginning Work in process x % comp First-in, First-out -EUP
    First-in, First-out -EUP

    To compute for Started and completed units

    Started-in/ Transferred-in Completed and transferred out


    Less: Ending Work in process or Less: Beginning Work in process
    Less: Lost(if any) Started and completed
    Started and completed

    3. Total cost to be accounted for


    Direct Conversion
    Started in Total
    Material Cost
    Beginning inventory cost XX XX XX XX
    Plus: Current cost XX XX XX XX
    Total cost to be accounted for XX XX XX XX

    4. Cost Per EUP


    Weighted Average First in, First out
    Beginning inventory cost Current cost
    Plus: Current cost Divided by:FIFO-EUP
    Total cost Cost Per EUP
    Divided by:WA-EUP
    Cost Per EUP
    5. Cost to be accounted must equal total cost accounted for
    Cost Accounted for

    Completed and transferred out


    Weighted Average FIFO
    Completed and transferred out nd
    (given, if 2 dept)
    xx Beginning inventory cost(given) xx
    (completed units x Total cost per EUP)
    Plus: Conversion cost to complete
    (BWIP x % uncomplete x cost per EUP) xx
    Plus: Started and completed
    xx
    (Started and completed units x total cost per EUP)
    Completed and transferred out xx Completed and transferred out xx

    Ending Work in process


    Weighted Average FIFO
    Started in EUP Started in EUP
    xx xx
    (EWIP EUP x cost per EUP) (EWIP EUP x cost per EUP)
    Direct material EUP Direct material EUP
    xx xx
    (EWIP EUP x cost per EUP) (EWIP EUP x cost per EUP)
    Conversion Cost EUP Conversion Cost EUP
    xx xx
    (EWIP EUP x cost per EUP) (EWIP EUP x cost per EUP)
    Ending Work in process Ending Work in process xx

    Completed and transferred out xx Completed and transferred out xx


    Plus: Ending Work in process xx Plus: Ending Work in process xx
    Total Cost Accounted for xx Total Cost Accounted for xx

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