Hoyt, Inc. has a process costing system at its Forest Street Plant. All materials are introduced when
Question:
Hoyt, Inc. has a process costing system at its Forest Street Plant. All materials are introduced when conversion costs reach 40 percent. The following information is available for physical units during August:
Required
a. Compute the equivalent units for materials costs and for conversion costs using the weightedaverage method.
b. Compute the equivalent units for materials costs and for conversion costs using the FIFO method.
c. The company president has been under considerable pressure to increase income. He tells the controller to change the estimated completion for ending work in process to 45 percent (from 25 percent).
1. What effect will this change have on the unit costs of units transferred to finished goods in August?
2. Would this be ethical?
3. Is this likely to be a successful strategy for affecting income over a long period of time?
Step by Step Answer:
a Weightedaverage method b Firstin Firstout FIFO method a 0 100100 already done at the beginning of ...View the full answer
