Horngren's Cost Accounting: A Managerial Emphasis (16th Edition)
16th Edition
ISBN: 9780134475585
Author: Srikant M. Datar, Madhav V. Rajan
Publisher: PEARSON
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Chapter 17, Problem 17.41P
Weighted-average method. McKnight Handcraft is a manufacturer of picture frames for large retailers. Every picture frame passes through two departments: the assembly department and the finishing department. This problem focuses on the assembly department. The process-costing system at McKnight has a single direct-cost category (direct materials) and a single indirect-cost category (conversion costs). Direct materials are added when the assembly department process is 10% complete. Conversion costs are added evenly during the assembly department’s process.
McKnight uses the weighted-average method of
a Degree of completion: direct materials, 100%; conversion costs, 40%.
b Degree of completion: direct materials, 100%; conversion costs, 15%.
- 1. Summarize the total assembly department costs for April 2017, and assign them to units completed (and transferred out) and to units in ending work in process.
Required
- 2. What issues should a manager focus on when reviewing the equivalent units calculation?
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McKnight Handcraft is a manufacturer of picture frames for large retailers. Every picture frame passes through two departments: the assembly department and the finishing department. This
problem focuses on the assembly department. The process-costing system at McKnight has a single direct-cost category (direct materials) and a single indirect-cost category (conversion
costs). Direct materials are added when the assembly department process is 10% complete. Conversion costs are added evenly during the assembly department's process. McKnight uses the
weighted-average method of process costing. Consider the following data for the assembly department in April 2017
E (Click the icon to view the data.)
Read the requirements.
Requirement 1. Summarize total assembly department costs for April 2017, and assign total costs to units completed (and transferred out) and to units in ending work in process.
Begin by calculating the physical units and equivalent units.
Equivalent Units
Data table…
Makani Handcraft is a manufacturer of picture frames for large retailers. Every picture frame passes
through two departments: the assembly department and the finishing department. This problem focuses
on the assembly department. The process-costing system at Makani has a single direct-cost category
(direct materials) and a single indirect-cost category (conversion costs). Direct materials are added at the
beginning of the process. Conversion costs are added evenly during the assembly department's process.
Consider the following data for the assembly department in June 2020:
Physical units (Frames)
Direct materials
Direct labour
Work in progress (June 1)
80
$1,500
$150
Completed during June
500
Work in progress June 30
200
Total costs added during June
$17,800
$11,500
Degree of completion is as follows:
Work in progress (June 1):
100%
60%
Work in progress June 30
100%
25%
Required:
Compute the costs assigned to products using two methods:
1. Weighted average method (WAM); |
2. First in…
PBB Company manufactures high end product. Because of the high volume of this type of
product, the company employs a process cost system using the weighted average method to
determine costs. Product Parts are manufactured in the Molding Department and
transferred to the assembly Department were they are partially assembled. After assembly,
the product is sent to packaging department. Cost per unit data for the high end product
has been completed through the Molding department. Annual cost and production figures
for the assembly Department are presented below:
Production Data
Beg. Inventory 50% Complete as to Assembly materials; 20% complete 3,000
as to Conversion
units
45,000
Transferred In during the year
units
40,000
Transferred to Packaging Department
units
4,000
Ending Inventory 80% complete
units
Cost Data:
Transferred-In
Materials
Conversion
Current Period
P 1,240,800
P 97,020
P 236,470
Work in Process, beginning
82,200
6,660
11,930
Damage product are identified on inspection…
Chapter 17 Solutions
Horngren's Cost Accounting: A Managerial Emphasis (16th Edition)
Ch. 17 - Give three examples of industries that use...Ch. 17 - In process costing, why are costs often divided...Ch. 17 - Explain equivalent units. Why are equivalent-unit...Ch. 17 - What problems might arise in estimating the degree...Ch. 17 - Name the five steps in process costing when...Ch. 17 - Name the three inventory methods commonly...Ch. 17 - Describe the distinctive characteristic of...Ch. 17 - Describe the distinctive characteristic of FIFO...Ch. 17 - Prob. 17.9QCh. 17 - Identify a major advantage of the FIFO method for...
Ch. 17 - Identify the main difference between journal...Ch. 17 - The standard-costing method is particularly...Ch. 17 - Why should the accountant distinguish between...Ch. 17 - Transferred-in costs are those costs incurred in...Ch. 17 - Theres no reason for me to get excited about the...Ch. 17 - Assuming beginning work in process is zero, the...Ch. 17 - The following information concerns Westheimer...Ch. 17 - Sepulveda Corporation uses a process costing...Ch. 17 - Penn Manufacturing Corporation uses a...Ch. 17 - Kimberly Manufacturing uses a process-costing...Ch. 17 - Equivalent units, zero beginning inventory....Ch. 17 - Journal entries (continuation of 17-21). Refer to...Ch. 17 - Zero beginning inventory, materials introduced in...Ch. 17 - Weighted-average method, equivalent units. The...Ch. 17 - Weighted-average method, assigning costs...Ch. 17 - FIFO method, equivalent units. Refer to the...Ch. 17 - FIFO method, assigning costs (continuation of...Ch. 17 - Operation costing. The Carter Furniture Company...Ch. 17 - Weighted-average method, assigning costs....Ch. 17 - FIFO method, assigning costs. 1. Do Exercise 17-29...Ch. 17 - Transferred-in costs, weighted-average method....Ch. 17 - Transferred-in costs, FIFO method. Refer to the...Ch. 17 - Operation costing. Egyptian Spa produces two...Ch. 17 - Standard-costing with beginning and ending work in...Ch. 17 - Equivalent units, comprehensive. Louisville Sports...Ch. 17 - Weighted-average method. Hoffman Company...Ch. 17 - Journal entries (continuation of 17-36). Required...Ch. 17 - FIFO method (continuation of 17-36). 1. Do Problem...Ch. 17 - Transferred-in costs, weighted-average method...Ch. 17 - Transferred-in costs, FIFO method (continuation of...Ch. 17 - Weighted-average method. McKnight Handcraft is a...Ch. 17 - FIFO method (continuation of 17-41). 1. Complete...Ch. 17 - Transferred-in costs, weighted-average method....Ch. 17 - Transferred-in costs, FIFO method. Refer to the...Ch. 17 - Standard costing, journal entries. The Warner...Ch. 17 - Multiple processes or operations, costing. The...Ch. 17 - Benchmarking, ethics. Amanda McNall is the...
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