Lesson 2 Process Cost Accounting Pages 67 – 74

1. A plant that uses process costing has 8,000 units in beginning work in process, 15,000

more started, and 5,000 units in the ending work in process. Using this information, answer

the following questions on a separate sheet of paper. Label each answer carefully and

show all of your work. (Each answer is worth 3 points.)

a. How many units are there to account for?

b. How many units are transferred using the average cost method?

c. How many units are transferred using the first-in, first-out method?

d. How many units were both started and completed during the period?

2. The Spangle Company uses the process cost system and average costing. The following

prediction data are for the month of July:

Use the form at the end of this examination to prepare a cost of production summary for

the month. (This problem is worth 15 points.)

Production Costs

Work in process, beginning of month

Materials $2,500

Labor 1,200

Factory overhead 1,100 $4,800

Costs incurred during the month

Materials $13,500

Labor 9,200

Factory overhead 8,500 31,200

$36,000

Production Report Units

In process, beginning of month 500

Finished and transferred during month 3,800

Work in process, end of month 400

Stage of completion 50%

Use the form at the end of this examination to prepare a cost of production summary for

the month. (This problem is worth 15 points.)

Is this the question you were looking for? If so, place your order here to get started!