Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN: 9781305970663
Author: Don R. Hansen, Maryanne M. Mowen
Publisher: Cengage Learning
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Chapter 6, Problem 43P
Novel Toys, Inc., manufactures plastic water guns. Each gun’s left and right frames are produced in the Molding Department. The left and right frames are then transferred to the Assembly Department where the trigger mechanism is inserted and the halves are glued together. (The left and right halves together define the unit of output for the Molding Department.) In June, the Molding Department reported the following data:
- a. In the Molding Department, all direct materials are added at the beginning of the process.
- b. Beginning work in process consisted of 3,000 units, 20 percent complete with respect to direct labor and
overhead. Costs in beginning inventory included direct materials, $450; and conversion costs, $138. - c. Costs added to production during the month were direct materials, $950; and conversion costs, $2,174.50.
- d. Inspection takes place at the end of the process. Malformed units are discarded. All spoilage is considered abnormal.
- e. During the month, 7,000 units were started, and 8,000 good units were transferred out to Finishing. All other units finished were malformed and discarded. There were 1,000 units that remained in ending work in process, 25 percent complete.
Required:
- 1. Prepare a physical flow schedule.
- 2. Calculate equivalent units of production using the weighted average method.
- 3. Calculate the unit cost.
- 4. What is the cost of goods transferred out? Ending work in process? Loss due to spoilage?
- 5. Prepare the
journal entry to remove spoilage from the Molding Department.
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Novel Toys, Inc., manufactures plastic water guns. Each gun’s left and right frames are pro-duced in the Molding Department. The left and right frames are then transferred to the Assem-bly Department where the trigger mechanism is inserted and the halves are glued together. (The
left and right halves together define the unit of output for the Molding Department.) In June,the Molding Department reported the following data:a. In the Molding Department, all direct materials are added at the beginning of the process.b. Beginning work in process consisted of 3,000 units, 20 percent complete with respect todirect labor and overhead. Costs in beginning inventory included direct materials, $450; andconversion costs, $138.c. Costs added to production during the month were direct materials, $950; and conversioncosts, $2,174.50.d. Inspection takes place at the end of the process. Malformed units are discarded. All spoilageis considered abnormal.e. During the month, 7,000 units were started, and…
Arona Corporation manufactures canoes in two departments, Fabrication and Waterproofing. In the Fabrication Department, fiberglass panels are
attached to a canoe- shaped aluminum frame. The canoes are then transferred to the Waterproofing department to be coated with sealant. Arona uses a
weighted-average process cost system to collect costs in both departments.
All materials in the Fabrication Department are added at the beginning of the production process. On July 1, the Fabrication Department had 30 canoes
in process that were 20% complete with respect to conversion cost. On July 31, Fabrication had 20 canoes in process that were 40% complete with
respect to conversion cost. During July, the Fabrication Department completed 87 canoes and transferred them to the Waterproofing Department.
What are the Fabrication Department's equivalent units of production related to conversion costs for July?
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Chapter 6 Solutions
Cornerstones of Cost Management (Cornerstones Series)
Ch. 6 - What is a process? Provide an example that...Ch. 6 - Describe the differences between process costing...Ch. 6 - Prob. 3DQCh. 6 - What are transferred-in costs?Ch. 6 - Explain why transferred-in costs are a special...Ch. 6 - What is a production report? What purpose does...Ch. 6 - Can process costing be used for a service...Ch. 6 - What are equivalent units? Why are they needed in...Ch. 6 - How is the equivalent unit calculation affected...Ch. 6 - Describe the five steps in accounting for the...
Ch. 6 - Under the weighted average method, how are...Ch. 6 - Under what conditions will the weighted average...Ch. 6 - In assigning costs to goods transferred out, how...Ch. 6 - Prob. 14DQCh. 6 - What is operation costing? When is it used?Ch. 6 - Lamont Company produced 80,000 machine parts for...Ch. 6 - Lising Therapy has a physical therapist who...Ch. 6 - Fleming, Fleming, and Johnson, a local CPA firm,...Ch. 6 - During October, McCourt Associates incurred total...Ch. 6 - Tomar Company produces vitamin energy drinks. The...Ch. 6 - Apeto Company produces premium chocolate candy...Ch. 6 - Jackson Products produces a barbeque sauce using...Ch. 6 - Gunnison Company had the following equivalent...Ch. 6 - Jackson Products produces a barbeque sauce using...Ch. 6 - Morrison Company had the equivalent units schedule...Ch. 6 - Shorts Company has three process departments:...Ch. 6 - A local barbershop cuts the hair of 1,200...Ch. 6 - Friedman Company uses JIT manufacturing. There are...Ch. 6 - Lacy, Inc., produces a subassembly used in the...Ch. 6 - Softkin Company manufactures sun protection...Ch. 6 - Heap Company manufactures a product that passes...Ch. 6 - K-Briggs Company uses the FIFO method to account...Ch. 6 - The following data are for four independent...Ch. 6 - Using the data from Exercise 6.18, compute the...Ch. 6 - Holmes Products, Inc., produces plastic cases used...Ch. 6 - Dama Company produces womens blouses and uses the...Ch. 6 - Fordman Company has a product that passes through...Ch. 6 - Using the same data found in Exercise 6.22, assume...Ch. 6 - Baxter Company has two processing departments:...Ch. 6 - Tasty Bread makes and supplies bread throughout...Ch. 6 - Under either weighted average or FIFO, when...Ch. 6 - During the month of June, the mixing department...Ch. 6 - As goods are transferred from a prior process to a...Ch. 6 - During March, Hanks Manufacturing started and...Ch. 6 - Proteger Company manufactures insect repellant...Ch. 6 - Swasey Fabrication, Inc., manufactures frames for...Ch. 6 - Refer to the data in Problem 6.31. Assume that the...Ch. 6 - Hatch Company produces a product that passes...Ch. 6 - FIFO Method, Single Department Analysis, One Cost...Ch. 6 - Hepworth Credit Corporation is a wholly owned...Ch. 6 - Muskoge Company uses a process-costing system. The...Ch. 6 - Prob. 37PCh. 6 - Healthway uses a process-costing system to compute...Ch. 6 - FIFO Method, Two-Department Analysis Refer to the...Ch. 6 - Jacson Company produces two brands of a popular...Ch. 6 - Golding Manufacturing, a division of Farnsworth...Ch. 6 - Larkin Company produces leather strips for western...Ch. 6 - Novel Toys, Inc., manufactures plastic water guns....Ch. 6 - Prob. 44P
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