Exam 6: Process Costing

Normal spoilage and abnormal spoilage should be classified as:

Stoltenberg Co. had the following information for the month of June: Work in process beginning inventory, June 1 2,000 units Units transferred in 16,000 units Work in process ending inventory, June 30 4,000 units Beginning work-in-process inventory is 30 percent complete as to conversion. Ending work-in-process inventory is 50 percent complete as to conversion. Materials are added at the end of the process. The equivalent units for transferred-in costs under the FIFO method are calculated to be:

Universal Automotive Group is a maker of engines for high performance cars and uses a process costing system. The following information pertains to the final department of manufacturing for Universal's most popular engine, the "Atomic 8". Beginning work-in-process ( 40\% completed) 400 units Transferred-in 1,600 units Normal spoilage 100 units Abnormal spoilage 100 units Good units transferred out 1,400 units Ending work-in-process (25\% completed) 400 units Conversion costs in beginning inventory \ 180,500 Current conversion costs \ 728,218 Universal Automotive Group calculates separate costs of spoilage by computing both normal and abnormal spoiled units. Normal spoilage costs are reallocated to good units and abnormal spoilage costs are charged as a loss. The units of the Atomic 8 that are spoiled are the result of defects not discovered before inspection of finished units. Using the weighted-average method, answer the following question: What are the unit conversion costs?

The weighted-average method of process costing makes no distinction between the cost incurred prior to the current period and the cost incurred in:

On March 1, Portland Company had 20,000 units of work in process in Department A, which were 100% complete as to material costs and 40% complete as to conversion costs.During March, 150,000 units were started in Department A and 160,000 units were completed and transferred to Department B.Work in process on March 31 was 100% complete as to material costs and 50% complete as to conversion costs.By what amount would the equivalent units for conversion costs for the month of March differ if the FIFO method were used instead of the weighted-average method?

Landry Co. had the following information for the month of December. All direct materials were one hundred percent complete, and beginning materials cost $14,000.Cost per equivalent unit for conversion under the FIFO method is calculated to be (rounded):