ADM 3346 Lecture Notes - Lecture 5: Weighted Arithmetic Mean

39 views4 pages

rubyporpoise627

12 Jan 2016

School

Department

Course

Professor

For unlimited access to Class Notes, a Class+ subscription is required.

Document Summary

Used where output is a large volume of a single, homogeneous product. One unit of product is indistinguishable from any other unit of product. Product flows evenly through a continuous production process. Each unit of product is assigned the same average cost. Dm are assumed to be applied at discrete points in the production process: often at the beginning of the production process, or at the start of work in a subsequent department down the assembly line. Cc are added equally along the production process. A derived amount of output units that: The eu calculations provide the denominator in the cost/eu computation. A cost/eu is computed for each cost category. The wa and fifo methods use different numerators in the cost/eu computation. The numerator for the wa cost/eu includes current costs plus the costs included in bi. The numerator for the fifo cost/eu includes only current costs.

Related Questions

Process Cost Accounting & Cost-Volume-Profit Analysis

This module focuses on measuring costs in process production companies. We explain process production, describe how to assign costs to processes, and compute and analyze cost per equivalent unit. Discuss two of the three topics:

What is meant by equivalent units of production, and why are they important when a process costing system is used?

What are the four steps in accounting for production activity in a period?

Job order costing and process costing are two major costing systems used in manufacturing. Briefly contrast the characteristics of these two systems.


Weighted Average Process Costing:
Minot Processing Company manufactures one product on acontinuous basis in two departments, Processing and Finishing. Allmaterials are added at the beginning of work on the product in theProcessing Department. During December 2009, the following eventsoccurred in the Processing Department:
Units started	16,000 units
Units completed and transferred to Finishing Department	15,000 units

Costs assigned to processing:Raw materials (one unit of rawmaterials for each unit of product started)	$142,900.00
Manufacturing supplies used	18,000
Direct labor costs incurred	51,000
Supervisors' salaries	12,000
Other production labor costs	14,000
Depreciation on equipment	6,000
Other production costs	18,000

Additional information follows:
Minot uses weighted average costing and applies manufacturingoverhead to Work-in-Process at the rate of 100 percent of directlabor cost.
Ending inventory in the Processing Department consists of 3,000units that are one-third converted.
Beginning inventory contained 2,000 units, one-half converted,with a cost of $34,500 ($24,500 for materials and $10,000 forconversion).
(a) Prepare a cost of production report for theProcessing Department for December.
Minot Processing Company: Processing Department Cost of Production Report For the Month Ending December 31, 2009
Summary of units in process:
Beginning
Units started
In process
Completed
Ending
Equivalent units in process:		Materials	Conversion	Total
Units completed
Plus equivalent units in ending inventory
Equivalent units in process
Total cost to be accounted for and cost per equivalent unit in process:
Beginning work-in-process		$	$	$
Current costs
Total cost in process		$	$	$
Equivalent units in process		+	+
Cost per equivalent unit in process		$	$	$
Accounting for total costs:
Transferred out				$
Ending work-in-process:
Materials			$
Conversion
Total cost accounted for				$
(b) Prepare an analysis of all changes inWork-in-Process.
Work-in-process:
Beginning			$
Current manufacturing costs:
Direct materials		$
Direct labor
Applied overhead
Total			$
Cost of goods manufactured
Ending			$

tealbuffalo667

Timekeeper Inc. manufactures clocks on a highly automated assembly line. Its costing system uses two cost categories, direct materials, and conversion costs. Each product must pass through the Assembly Department and the Testing Department. Direct materials are added at the beginning of the production process. Conversion costs are allocated evenly throughout production. Timekeeper Inc. uses weighted−average costing.

Data for the Assembly Department for June 2017 are:

Work in process, beginning inventory 380 units
Direct materials (100% complete)
Conversion costs (60% complete)
Units started during June 950 units
Work in process, ending inventory: 150 units
Direct materials (100% complete)
Conversion costs (80% complete)

Costs for June 2017:
Work in process, beginning inventory:
Direct materials $91,000
Conversion costs $137,500
Direct materials cost added during June $604,000
Conversion costs added during June $401,000

What are the equivalent units for direct materials and conversion costs, respectively, for June? (Round final answers to the nearest unit.)

cerisecrow273

ADM 3346 Lecture Notes - Lecture 5: Weighted Arithmetic Mean

Document Summary

Get access

Related Documents

ADM 3346 Lecture 5: Chapter 17

ADM 3346 Chapter Notes - Chapter 18: Finished Good, Vajrayana

ADM 3346 Lecture Notes - Lecture 6: Income Statement

Related Questions