Chapter_4_Handout_Solution

Chapter_4_Handout_Solution - Acc 200 Chapter 4 Handout...

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Acc 200 Chapter 4 Handout Solutions SOLUTION TO PROCESS COSTING PROBLEMS PRACTICE PROBLEM #1 : Step #1: Beginning units 50,000 + units started 200,000 - Ending units (30,000) Units completed 220,000 → of which 50,000 were from the beginning units, and →170,000 were started and completed in current period Step #2: 50,000 units X 80% = 40,000 eu’s 170,000 X 100% = 170,000 eu’s 30,000 X 60% = 18,000 eu’s Total Equivalent Units 228,000 eu’s Step #3 Current Period Costs $340,000 ÷ Total EU’s ÷ 228,000 eu’s Cost per EU $1.49122807 Per EU Step #4 18,000 EU’s in ending inventory X $1.49122807 per EU = $26,842 (rounded to nearest dollar) Cost of Ending Inventory Step #5 Beginning WIP costs $40,000 + Current Period Costs 340,000 Total Avail. Costs 380,000 - Ending WIP Costs (step #3) (26,842) COGM $353,158 Proof: Cost of Beginning Inventory incurred last period $40,000.00 Cost to complete beginning inventory (40,000 EUs x 1.49122807) $59,649.12 Cost to start and finish 170,000 units from scratch (170,000 EUs x 1.49122807) $253,508.77 Total $353,157.89
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PRACTICE PROBLEM #2 : Step #1: Beginning units 3,000 + units started 35,000 - Ending units (10,000) Units completed 28,000 → of which 3,000 were from the beginning units, and →25,000 were started and completed
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