SOLUTION:

1. ANS:
Landers Company
Schedule of Equivalent Units for
Fifo and Weighted Average
May 31, 20X5
FIFO
Beginning Work In Process

10,000

Units Started
Units to Acct. For
Beginning Work In Process
Started & Completed

120,000
130,000
10,000
90,000

Ending Work in Process

Units Accounted For

30,000
130,000

(a)
BWIP
S&C
EWIP
EUP

FIFO
Mat.
0
90,000
30,000
120,000

DIF: Moderate

CC
7,500
90,000
9,000
106,500

Weighted Average
Beginning Work In
Process
Units Started
Units to Acct. For
Transferred Out
Ending Work in
Process
Units Accounted For

(b) Weighted Average

Mat.
TO
EI
EUP

100,000
30,000
130,000

10,000
120,000
130,000
100,000
30,000
130,000

CC
100,000
9,000
109,000

OBJ: 6-3,6-4

2. ANS:
Landers Company
Schedule of Average Cost Per Unit
FIFO and Weighted Average
May 31, 20X5
(a) FIFO
Mat.
Costs $33,000
Eq Units 120,000
$.275/eq unit
Total cost/eq. unit

DIF: Moderate

CC
$109,695
106,500
$ 1.03/eq
unit
$ 1.305/eq
unit

(b) Weighted Average

Mat.
CC
$ 35,100
$111,725
130,000
109,000
$ .27/eq
$ 1.025/eq
unit
unit
$ 1.295/eq
unit

OBJ: 6-3,6-4

Cost Accounting Foundations and Evolutions

Kinney, Raiborn

3. ANS:
Landers Company
Schedule of Assigned Costs
FIFO and Weighted Average
May 31, 20X5
(a) FIFO
Beginning Work in Process
To complete (7,500 x $1.03) =

Started and Completed

90,000 x $1.305 =
Total costs transferred out

117,450
$129,305

Ending Work in Process

30,000 x $ .275 =
9,000 x $1.03 =

Total costs accounted for

(b) Weighted Average
Completed
100,000 x $1.295 =
Ending Work in Process
30,000 x $ .27 =
9,000 x $1.025 =
Total costs accounted for
DIF: Difficult

4,130
7,725
$ 11,855

8,250
9,270
$ 17,520
$146,825

$129,500
$

8,100
9,225
$ 17,325
$146,825

OBJ: 6-3,6-4

Cost Accounting Foundations and Evolutions

Kinney, Raiborn

4. ANS:
a. Cooking Department
Materials
Transferred Out
Ending Work in Process
TOTAL EUP

17,100
2,400
19,500

Conversion
Costs
17,100
1,440
18,540

Packaging Department
Transferred
In
Transferred Out
Ending Work in Process
TOTAL EUP
b.

17,600
500
18,100

Materials.
17,600
400
18,000

Conversion
Costs
17,600
400
18,000

Cooking Department
Materials
Beginning Work in Process
Transferred from Cooking
Ending Work in Process
TOTAL EUP

0
12,600
2,400
15,000

Conversion
Costs
3,150
12,600
1,440
17,190

Packaging Department
Transferred
In
Beginning Work in Process
Transferred from Cooking
Ending Work in Process
TOTAL EUP
DIF: Difficult

0
16,600
500
17,100

Materials
100
16,600
400
17,100

Conversion
Costs
200
16,600
400
17,200

OBJ: 6-3,6-4

Cost Accounting Foundations and Evolutions

Kinney, Raiborn

5. ANS:
a.

Weighted average inventory

assumption
Dept 1
20,000
Complete
5,000
Eq-End WIP
25,000
EP-WA

Unit
Cost

$201,050 = $8.042
25,000

End WIP

MAT

CC

20,000
0
20,000

20,000
2,000
22,000

$34,000 = $1.70
20,000

$109,450 = $4.975
22,000

= $14.717

= $40,210
=
9,950
$50,160

Dept 1 = 5,000 x $8.042

CC = 2,000 units x $4.975

COGM = $344,500 - $50,160 = $294,340

b.

FIFO inventory assumption

Dept 1

MAT

Complete
Eq-End WIP
- Eq-Begin

20,000
5,000
(2,000)

20,000
0
0

EP-WA

23,000

20,000

Unit
Cost

$184,000 = $8.00
23,000

$34,000 = $1.70
20,000

End WIP

Dept 1 = 5,000 units x $8.00

CC = 2,000 units x $5.00

CC
20,000
2,000
(1,200)
20,800

$104,000 = $5.00
20,800

= $14.70

= $40,000
= 10,000
$50,000

COGM = $344,500 - $50,000 = $294,500

DIF: Moderate

OBJ: 6-3,6-4

Cost Accounting Foundations and Evolutions

Kinney, Raiborn

6. ANS:
a.

c.
Materials
46,500
9,000
(8,000)
47,500

b.

Conversion
Costs
46,500
3,000
(6,000)
43,500

PD

Mat

44,500
12,000
(10,000)
46,500

CC

44,500
0
0
44,500

44,500
2,400
(3,000)
43,900

Since the material in the second department goes in at the 50 percent point and the ending WIP
inventory is only at the 20 percent point, units complete is the same as the equivalents of
material 44,500, given that units started plus units in beginning WIP are equal to units
complete plus ending WIP 10,000 + 46,500 - 44,500 = 12,000 units in ending WIP.

DIF: Moderate

OBJ: 6-3,6-4

7. ANS:
Equivalent production
Units complete
+ Equiv. ending WIP
= Equiv. prod. average
- Equiv. begin. WIP
= Equiv. prod. FIFO

16,000
6,000
22,000
(4,000)
18,000

Unit Cost Average

Unit Cost FIFO

TI = $620 + 1,800
22,000

Mat =

$4,800
16,000

TI

= $0.11

Conv. cost

16,000
0
16,000
0
16,000

TI = $1,800
18,000

16,000
4,000
20,000
(3,000)
17,000

= $0.10

Mat = $4,800
= $0.30

CC = $2,000 + 10,200
20,000

End. WIP-WA
PD
CC

Material

16,000

= $0.30

CC = $10,200
= $0.61

17,000

= $0.60

End. WIP-FIFO
6,000 x $0.11 =
4,000 x $0.61 =

660.00
2,440.00
$3,100.00

6,000 x $0.10 =
4,000 x $0.60 =

600.00
2,400.00
$3,000.00

Cost of Goods Complete

WA
$19,420 - 3,100 =

FIFO
$16,320.00

$19,420 - 3,000 =

Cost Accounting Foundations and Evolutions

$16,420.00

Kinney, Raiborn

DIF: Moderate

OBJ: 6-3,6-4

MSC: 15-20 min

8. ANS:
a.
TI
Complete
+ Equiv WIP
+ Normal Sp
+ Abnor Sp

33,600
10,500
1,680
420
46,200

b. 33,600 x $9
1,680 x $9

$302,400
15,120
$317,520

c. 10,500 x $5
10,500 x $1
4,200 x $3

$52,500
10,500
12,600
$75,600

Mat
33,600
10,500
1,680
420
46,200

CC
33,600
4,200
1,680
420
39,900

TC = 46,200 x $5
46,200 x $1
39,900 x $3

$231,000
46,200
119,700
$396,900

COGM = $396,900 - 75,600 - 3,780 = $317,520

d. $5 = $18,900 + X
46,200
X = $231,000 - 18,900 = $212,100
e. ABN = 420 x $9 = $3,780
420 x $9 = $3,780
DIF: Moderate

OBJ: 6-3,6-8

Cost Accounting Foundations and Evolutions

Kinney, Raiborn

9. ANS:
TI

MAT

6,650
1,500
100
200
8,450

Complete
+ end
+ normal
+ abnormal

DL

6,650
0
100
0
6,750

MOH

6,650
600
100
60
7,410

6,650
300
100
30
7,080

Unit Cost

End WIP
DL
MOH
TI

600 x $3.40
300 x $8.80
1,500 x $9.00

=
=
=

Abnormal Loss
DL
MOH
TI

60 x $3.40
30 x $8.80
200 x $9.00

=
=
=

$ 2,040
2,640
13,500
$18,180

204
264
1,800
$ 2,268

COGM = $171,513 - 18,180 - 2,268 = $151,065

DIF: Moderate

OBJ: 6-3,6-8

10. ANS:
Normal Sp = 11% x 61,000 = 6,710 units
Abnormal Sp = 8,000 - 6,710 = 1,290 units
Mat
CC
Complete
+ End
+ Ab Sp
- Ave
- Beg
FIFO

61,000
16,000
1,290
78,290
(11,000)
67,290

FIFO

61,000
12,000
1,290
74,290
(2,750)
71,540

Mat =

CC =

WIP
Material
CC

$1,480,000
67,290

$942,000
71,540

16,000 x
$22.00
12,000 x
$13.17

$352,000

Loss = 1,290 x $35.17

Cost Accounting Foundations and Evolutions

= $22.00

13.17
$35.17

158,040
$510,040
45,369

Kinney, Raiborn

COGM = $2,672,000 - 510,040 - 45,369 = $2,116,591

DIF: Moderate

OBJ: 6-3,6-8

11. ANS:
a.
1

Complete

Mat

CC

22,000

22,000

2,800

+ End WIP

24,800

- Beg WIP

(1,000)
23,800

1,120
23,120

(650)

(2,800
x 4)

Mat =

$38,080
23,800

1.60

CC =

$78,645

3.50

4,480

22,470

(1,000
x .65)

End
WIP =

22,470

2,800 x
$1.60
1,120 x
$3.50

3.920
$ 8,400
$112,175

COGM = $120,575 - 8,400

b.
2
TI

Mat

CC

Mat =

$ 77,775
25,500

$3.05

Complete
+ End WIP
+ Normal

24,000
4,500
1,100

24,000
0
1,120

24,000
900
880

CC =

$ 15,399
26,100

$0.59

+ Abnormal

400
30,000

400
25,500

320
26,100

TI =

$154,500

5.15

30,000

End WIP
4,500 x $5.15
900 x $0.59

$23,175
531
$23,706

Abn Loss
400 x $3.05
320 x $0.59
400 x $5.15

$1,220
189
2,060
$3,469

COGM = $247,674 - 23,706 - 3,469 = $220,499

DIF: Moderate

OBJ: 6-3, 6-8

Cost Accounting Foundations and Evolutions

Kinney, Raiborn

12. ANS:
Mat
Units Complete
+ Equivalents Ending WIP
+ Abnormal Loss
= Equivalent Production-WA
= Equivalent Begin WIP
= Equivalent Production-FIFO
Unit Costs:
WA
Mat
$915,120 = $5.05
181,200
CC

$338,688 = $1.97
171,520

Ending WIP
Material
CC
Abnormal Spoilage
Material
CC

20,000 x $5.05
14,000 x $1.97

9,200 x $5.05
5,520 x $1.97

152,000
20,000
9,200
181,200
(6,000)
175,200

FIFO
Mat

CC

CC
152,000
14,000
5,520
171,520
(1,800)
169,720

(9,200 x .6)

$885,120
175,200

= $5.05

$335,088
169,720

= $1.97

$101,000
27,580
$128,580

$ 46,460
10,874
$ 57,334

Cost of Good Transferred

1,253,808 - 128,580 - 57,334 = $1,067,894
DIF: Moderate

OBJ: 6-3,6-8

Cost Accounting Foundations and Evolutions

Kinney, Raiborn

13. ANS:
Delightful Yogurt Company
Cost Report
October 31, 20X5
5,000
5,500
1,200
11,700

BWIP
Trans. In
Fruit
Acctble. For

TI
9,000
1,700
1,000
11,700

Transferred Out
EWIP
Abnormal Spoilage

Fruit
9,000
1,700
1,000
11,700

Container
9,000
0
0
9,000

CC
9,000
1,020
980
11,000

Costs:
TI
$ 9,700
12,400
$22,100
11,700
$1.89

BWIP
Current
EUP
Per unit

Fruit

Container

$10,500
54,000
$64,500
11,700
$5.51

$ 0
11,000
$11,000
9,000
$1.22

$ 3,213
9,367
10,475

$ 23,055

$ 1,890
5,510
10,065

17,465

CC
$ 15,000
98,000
$113,000
11,000
$10.27

Cost Assignment:
EWIP
1,700 x $1.89 =
1,700 x $5.51 =
1,020 x $10.27 =
Spoilage
1,000 x $1.89 =
1,000 x $5.51 =
980 x $10.27 =
Transferred Out
$210,600 - 23,055 - 17,465 =

$210,600

Total accounted for

DIF: Moderate

170,080

OBJ: 6-3,6-8

Cost Accounting Foundations and Evolutions

Kinney, Raiborn

14. ANS:
BI 8,000 + Started 35,000 = Accountable for 43,000
Hocking Company
Cost Report
March 31, 20X8
Material
8,000
11,500
15,000
6,000
2,500
43,000

BWIP
S&C
EWIP
Norm
Abnorm.
Acctd. For

0
11,500
15,000
0
2,500
29,000

CC
1,600
11,500
8,250
0
23,850

Material: $50,000/29,000 = $1.72

Conversion Costs: $175,000/23,850 = $7.34
Cost Assignment:
Ending Work in Process
15,000 x $1.72 =
8,250 x $7.34 =
Abnormal Spoilage
2,500 x $9.06 =
Cost Transferred Out
$284,000 - 86,355 - 22,650 =
Total costs accounted for
DIF: Moderate

$ 25,800
60,555

$ 86,355
22,650
174,995
$ 284,000

OBJ: 6-4,6-8

Cost Accounting Foundations and Evolutions

Kinney, Raiborn

15. ANS:
BI 8,000 + Started 35,000 = Accountable for 43,000
Hocking Company
Cost Report
March 31, 20X8
Material
Transferred Out
Ending Work In Process
Normal Spoilage
Abnormal Spoilage 2,500
Accounted For

19,500
15,000
6,000
2,500
43,000

19,500
15,000
0
2,500
37,000

CC
19,500
8,250
0
30,250

Material: $64,000/37,000 = $1.73

Conversion Costs: $220,000/30,250 = $ 7.27
Cost Assignment:
Ending Work in Process
15,000 x $1.73 =
8,250 x $7.27 =
Abnormal Spoilage
2,500 x $9.00 =
Transferred Out
$284,000 - 85,928 - 22,500 =
Total costs accounted for
DIF: Moderate

$25,950
59,978

$ 85,928
22,500
175,572
$ 284,000

OBJ: 6-3,6-8

Cost Accounting Foundations and Evolutions

Kinney, Raiborn