Chapter 4 part 2
Cost per Equivalent Unit =
(Cost of Beg. WP Inventory + Cost Added During the Period) / Equivalent Units of Production
Alternate: Equivalent Units of Production =
(Works In Process End Inventory) x (%) + Units Transferred Out
Costs transferred in are always _% complete with respect to the department they came from.
100%
The equivalent units completed are treated the same as units transferred out for purposes of:
determining cost per unit.
When computing the Equivalent Units of Production under the Weighted-Average method, _ is ignored.
partially completed beginning work in process inventory
There are material costs as well as conversion costs. Both are expressed at first as:
percentages
The Costs per Equivalent Unit are used to:
value units in ending inventory and units that are transferred out to the next department.
Using the Weighted Average method, there are a total of _ equivalent units of production if Work in Process Inventory has 40 Equivalent Units and 30 units were transferred to the next department.
70
Cost of Units Transferred Out =
Cost per Equivalent Unit x Number of Units Transferred
Job-order Costing Examples
Cruise ships
Raw Materials were issued: $5 for Dept. A and $10 for Dept. B. What are the journal entries?
Debit: Works in Process Dept. A: $5 Debit: Works in Process Dept. B: $10 Credit: Raw Materials: $15
Conversion cost =
Direct Labor Cost + Manufacturing Overhead Cost
Beg. WP Inv. + Units Started or Trans. In =
End. WP Inv. + Units Completed and Trans. Out
Process Costing Examples
Gasoline, flour, toothpaste
Equivalent Units of Production =
Number of Units Transferred to the next department + Equivalent Units in Ending Works in Process Inventory
Costs transferred in are treated as another category of _ just like material or conversion costs.
cost