Exercise Over Chapter 6 Material (Process Costing)

(NOTE: On your assignment submission, you only need to provide me with four numbers with labels a and b and c and d to correspond to the requirements below. You do NOT have to do full Cost of Production Reports for this assignment [but you may sketch out Cost of Production Reports on your own separate pieces of paper to help you get the answers for this assignment if that helps you].)

T Company makes a product that goes through a single processing department. Direct Materials are added at the start of the process, while Conversion Costs are added evenly during the process. T Company uses the Weighted Average method of Process Costing.

During last month, T Company had 10,870 units in beginning Work-in-Process Inventory which were 100% complete for materials and 30% complete for conversion. There were 43,130 units started during the period. After finishing the 10,870 units in beginning Work-in-Process Inventory, the company started and completed 29,100 units. (That means the total units transferred to Finished Goods for the period was 10,870 + 29,100 = 39,970 units.) T Company had 14,030 units in ending Work-in-Process Inventory which were 100% complete for materials and 60% complete for conversion.

The beginning Work-in-Process Inventory had a value of $127,355 (which was $105,895 of materials and $21,460 of conversion). During the month, costs added were $998,383 (which was $366,605 of materials and $631,778 of conversion).

PART #1 REQUIRED: Now assume all of the above EXCEPT that T Company uses the Weighted Average method of Process Costing. (a) Calculate the dollar cost of items transferred out of Work-in-Process Inventory and into Finished Goods Inventory for the month using the Weighted Average method of Process Costing. (b) Calculate the dollar cost of items in Ending Inventory (at the end of the month) using the Weighted Average method of Process Costing.

PART #2 REQUIRED: Now assume all of the above EXCEPT that T Company uses the FIFO method of Process Costing. (c) Calculate the dollar cost of items transferred out of Work-in-Process Inventory and into Finished Goods Inventory for the month using the FIFO method of Process Costing. (d) Calculate the dollar cost of items in Ending Inventory (at the end of the month) using the FIFO method of Process Costing.