QUIZ ON

PROCESS
COSTING
September 30, 2023
Item No. 1

Joy Manufacturing has three producing departments in its

factory. The ending inventory in the Milling Department
consisted of 3,000 units. These units were 60% complete
with respect to labor and factory overhead. Materials are
applied at the end of the milling process. Unit costs for the
complete process in the Milling Department are:
materials, P1; labor, P2; and factory overhead, P3. The
appropriate unit cost for each unit in the ending inventory
is?
Item No. 1

ANSWER: P3

Calculation: 60% (P2 + P3) = P3

Item No. 2

Golds Products transferred 10,000 units to one

department. An additional 3,000 units of materials were
added in the department. At the end of the month, 7,000
units were transferred to the next department. There was
no beginning inventory. The costs for units transferred in
would be effectively allocated over?
Item No. 2

ANSWER: 13,000 units

Calculation: 7,000 units transferred out + 6,000 units in

ending inventory = 13,000 units
Item No. 3

Dream, Inc. instituted a new process in October. During

October, 10,000 units were started in Department A. Of
the units started, 7,000 were transferred to Department B,
and 3,000 remained in work in process at October 31. The
work in process at October 31 was 100% complete as to
material costs and 50% complete as to conversion costs.
Materials costs of P27,000 and conversion costs of
P39,950 were charged to Department A in October. What
were the total costs transferred to Department B?
Item No. 3

ANSWER: P51,800

Calculation:
Materials unit cost = P27,000 ÷ (7,000 + 3,000) = P2.70
Conversion unit cost = P39,950 ÷ [7,000 + 50%(3,000)] = P4.70
Costs transferred = 7,000(P2.70 + P4.70) = P51,800
Item No. 4

New York Processing Co. uses the average costing method

and reported a beginning inventory of 5,000 units that
were 20% complete with respect to materials in one
department. During the month, 11,000 units were started;
8,000 units were finished; ending inventory amounted to
8,000 units that were 60% complete with respect to
materials. Total materials cost during the period for work
in process should be spread over?
Item No. 4

ANSWER: 12,800 units

Calculation: 8,000 + .60(8,000) = 12,800 units

Item No. 5

Dove Corporation's production cycle starts in the Mixing

Department. The following information is available for April:
Units
Work in process, April 1 (50% complete) 40,000
Started in April 240,000
Work in process, April 30 (60% complete) 25,000
Materials are added at the beginning of the process in the Mixing
Department. Using the average cost method, what are the
equivalent units of production for the month of April?
Materials:_________; Conversion:_________
Item No. 5

ANSWER: M=280,000; C=270,000

Calculation:
Materials = 40,000 + 240,000 = 280,000
Conversion = (280,000 - 25,000) + 60%(25,000) = 270,000
Item No. 6

Information concerning Department A of News Company for June is as

follows:
Units Materials Costs
Beginning work in process 17,000 P12,800
Started in June 82,000 69,700
Units completed 85,000
Ending work in process 14,000

All materials are added at the beginning of the process. Using the
average cost method, the cost per equivalent unit for materials is?
Item No. 6

ANSWER: P0.833

Calculation:
(P12,800 + P69,700) ÷ (85,000 + 14,000) = P0.833
Item No. 7

Barbie Company adds materials in the beginning of the process in the

Forming Department, which is the first of two stages of its production
cycle. Information concerning the materials used in the Forming
Department in October is as follows:
Units Materials Costs
Work in process, October 1 6,000 P 3,000
Units started 50,000 25,560
Units completed and transferred out 44,000

Using the average cost method, what was the materials cost of work in
process at October 31?
Item No. 7

ANSWER: P6,120

Calculation:
(P3,000 + P25,560) ÷ (44,000 + 12,000) = P0.51
P0.51 x 12,000 = P6,120
Item No. 8

During March, Ken Company's Department Y equivalent unit product

costs, computed under the average cost method, were as follows:

Materials P1
Conversion 3
Transferred-in 5

Materials are introduced at the end of the process in Department Y.

There were 4,000 units (40% complete as to conversion costs) in work in
process at March 31. The total costs assigned to the March 31 work in
process inventory should be?
Item No. 8

ANSWER: P24,800

Calculation:
P5(4,000) + P3(4,000 x .4) = P24,800
Item No. 9

Connie Company computed the flow of physical units completed for

Department M for the month of March as follows:
Units completed:
From work in process on March 1 15,000
From March production 45,000
Total 60,000
Materials are added at the beginning of the process. The 12,000 units of
work in process at March 31 were 80% complete as to conversion costs.
The work in process at March 1 was 60% complete as to conversion
costs. Using the FIFO method, the equivalent units for March conversion
costs were?
Item No. 9

ANSWER: 60,600

Calculation:
(15,000 x .4) + 45,000 + (12,000 x .8) = 60,600
Item No. 10

Life Company computed the physical flow of units for Department A for
the month of April as follows:
Units completed:
From work in process on April 1 10,000
From April production 30,000
Total 40,000
Materials are added at the beginning of the process. Units of work in
process at April 30 were 8,000. The work in process at April 1 was 80%
complete as to conversion costs, and the work in process at April 30 was
60% complete as to conversion costs. What are the equivalent units of
production for the month of April using the FIFO method?
Materials:_________; Conversion:_________
Item No. 10

ANSWER: M=38,000; C=36,800

Calculation:
Materials = 30,000 + 8,000 = 38,000
Conversion = (10,000 x .2) + 30,000 + (8,000 x .6) = 36,800
Item No. 11

Department A is the first stage of Man Company's production cycle. The

following information is available for conversion costs for the month of
April:
Units
Beginning work in process (60% complete) 20,000
Started in April 340,000
Completed in April and transferred to Department B 320,000
Ending work in process (40% complete) 40,000

Using the FIFO method, the equivalent units for the conversion cost
calculation are?
Item No. 11

ANSWER: 324,000

Calculation:
(20,000 x .4) + 300,000 + (40,000 x .4) = 324,000
Item No. 12

Hello Company manufactures Product X in a two-stage production cycle in

Departments A and B. Materials are added at the beginning of the process in
Department B. Hello uses the average costing method. Conversion costs for
Department B were 50% complete as to the 6,000 units in beginning work in
process and 75% complete as to the 8,000 units in ending work in process. A
total of 12,000 units were completed and transferred out of Department B
during February. An analysis of the costs relating to work in process and
production activity in Department B for February follows:
Transferred- in Costs Materials Costs Conversion Costs
Work in process, February 1:
Costs attached P12,000 P2,500 P1,000
February activity:
Costs added 29,000 5,500 5,000

The total cost per equivalent unit transferred out for February of Product X was?
Item No. 12

ANSWER: P2.78
Calculation:
Transferred-in costs = P41,000 / 20,000 = P2.05
Materials cost = P8,000 / 20,000 = .40
Conversion cost = P6,000 / 18,000 = .33
P2.78
Item No. 13

Simpson Co. adds materials at the beginning of the process in Department M.

The following information pertains to Department M's work in process during
April:
Units
Work in process on April 1 (60% complete as to conversion cost) 3,000
Started in April 25,000
Completed in April 20,000
Work in process on April 30 (75% complete as to conversion cost) 8,000

Under the average costing method, the equivalent units for conversion cost
are?
Item No. 13

ANSWER: 26,000

Calculation:
20,000 + .75(8,000) = 26,000
Item No. 14

Julia Company makes fabric-covered hatboxes. The company began

September with 500 boxes in process that were 100 percent
complete as to cardboard, 80 percent complete as to cloth, and 60
percent complete as to conversion costs. During the month, 3,300
boxes were started. On September 30, 350 boxes were in process
(100 percent complete as to cardboard, 70 percent complete as to
cloth, and 55 percent complete as to conversion costs). Using the
FIFO method, what are equivalent units for cloth?
Item No. 14

ANSWER: 3,295
Calculation:
Beginning Work in Process (Ignored for FIFO) 500 0% -
+ Completion of Units in Process 500 20% 100
+ Units Started and Completed 2,950 100% 2,950
+ Ending Work in Process 350 70% 245
Equivalent Units of Production 3,295
Item No. 15

Kellie Company makes small metal containers. The company began

December with 250 containers in process that were 30 percent
complete as to material and 40 percent complete as to conversion
costs. During the month, 5,000 containers were started. At month
end, 1,700 containers were still in process (45 percent complete as
to material and 80 percent complete as to conversion costs). Using
the weighted average method, what are the equivalent units for
conversion costs?
Item No. 15

ANSWER: 4,910
Calculation:
Beginning Work in Process 250 40% 100
+ Completion of Units in Process 500 60% 150
+ Units Started and Completed 3,300 100% 3,300
+ Ending Work in Process 1,700 80% 1,360
Equivalent Units of Production 4,910