Exam 4: Process Costing and Hybrid Product-Costing Systems

Windsor Corporation, which adds materials at the beginning of production, uses a weighted-average process costing system. Consider the data that follow: Number of Units Cost of Materials Beginning work in process 40,000 \ 80,600 Started in June 60,000 124,400 Production completed 75,000 Ending work in process 25,000 The company's cost per equivalent unit for materials is:

Edwards Company had a beginning work-in-process inventory of 30,000 units on June 1. These units contained $120,000 of direct materials and $272,000 of conversion costs. The following data relate to activity during June: $\begin{array} { l r } \text { Production completed (units) } & 70,000 \\\text { Ending work in process, } 60 \% \text { complete (units) } & 20,000 \\\text { Direct materials used (\$) } & 258,000 \\\text { Conversion costs } ( \$ ) & 695,600\end{array}$ Edwards uses a weighted-average process-costing system. All materials are added at the start of manufacturing; in contrast, conversion costs are incurred evenly throughout the production process. Required: A. Compute the total equivalent units for direct material and conversion cost. B. Compute the cost per equivalent unit of direct material and conversion cost. C. Determine the cost of completed production. D. Determine the cost of the June 30 work in process.

Superior Chemical Company refines a variety of petrochemical products. The following data pertain to the firm's Cincinnati plant: Work in process, August 1: 100,000 gallons Direct material 100\% complete Conversion 25\% complete Units started into production 1,375,000 gallons Work in process, August 31: 120,000 gallons Direct material 100\% complete Conversion 80\% complete Required: Compute the equivalent units of direct materials and conversion for August.

Average Company uses a weighted-average process-costing system. The Company records disclosed that Department A completed 100,000 units during the month and had 20,000 units in process at month-end, 50% complete. Conversion costs associated with the beginning work-in-process inventory amounted to $401,000, and amounts that relate to the current month totaled $950,000. If conversion is incurred uniformly throughout manufacturing, Average's equivalent-unit cost is:

Draper Incorporated., had 8,000 units of work in process on November 1 that were 60% complete. During November, 15,000 units were completed and as of November 30, 9,000 units that were 40% complete remained in production. How many units were started during November?

Process costing would be used in all of the following industries except:

Extra Inc. had 9,000 units of work in process on March 1. During March, 30,600 units were started and as of March 31, 7,500 units remained in production. How many units were completed during March?