Chapter 4 Handout

Chapter 4 Handout - ACC200 Introduction to Managerial...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
ACC200 Introduction to Managerial Accounting Chapter 4 Handout Process Costing Problems (FIFO Method) STEP #1: From the information given, compute the following three items: # of units in beginning WIP inventory and percent complete # of units started and completed in the current period # of units in ending WIP inventory and percent complete STEP #2: Using the three items from step #1, compute the total number of equivalent units for the current period. STEP #3 Compute the cost per equivalent unit by taking the current period’s costs ÷ total EU’s (from Step #2). STEP #4: Calculate the cost of ending work in process inventory by taking the number of EU’s in ending WIP (from Step #1) and multiplying it by the cost per EU (from step #3). STEP #5: Solve for the COGM . This can be done in a couple of different ways. The easy way to do it is to simply take the beginning costs + current period’s costs and subtract the costs of ending WIP from Step 4. (Note that Step 4 and Step 5 are combined in your book)
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 03/10/2011 for the course ACC 200 taught by Professor Buckless during the Spring '08 term at N.C. State.

Page1 / 5

Chapter 4 Handout - ACC200 Introduction to Managerial...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online