# Acct 212 Chapter 3 Notes.docx - Accounting LS We provide a...

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Accounting LS We provide a step-by-step illustration of process costing. Each process (or department) in a process operation follows these steps: 1. Determine the physical flow of units. 2. Compute equivalent units of production. 3. Compute cost per equivalent unit of production. 4. Assign and reconcile costs. Department A completed and transferred to finished goods a total of 60,000 units. Their ending inventory consisted of 40,000 units which were 80% complete with respect to direct materials and 30% complete with respect to conversion cost. The cost per EUP for direct materials is \$4.00 and for conversion is \$3.50. The cost of ending work in process inventory is \$170,000 A process cost summary summarizes the following process costing steps: physical flow of units total costs charged to the department equivalent units of production Equivalent Units of Production = Number of whole units completed and transferred out + Number of equivalent units in ending work in process