Question 4 Hi-Tech Mortgage Company uses a process costing system to accumulate

Question

Question 4 Hi-Tech Mortgage Company uses a process costing system to accumulate costs in its loan application department. When an application is completed, it is forwarded to the loan department for final processing. The following processing and cost data pertain to September: 1. Applications in process on September 1, 80 Applications started in September, 1,000 Completed applications during September, 800 Applications still in process at September 30 were 100% complete in terms of materials (forms) and 60% complete in terms of conversion costs Beginning work in process: Direct materials $1,000 2. Conversion costs 3,800 September costs: Direct materials Direct labour Overhead $4,400 10,000 9,432 3. 4. Materials are the forms used in the application process, and these costs are incurred at the beginning of the process Conversion costs are incurred uniformly during the process Determine the equivalent units of service (production) for materials and conversion costs Conversion Costs Materials Total equivalent units

Explanation / Answer

UNITS TO ACCOUNT FOR: Beginning Work in Process units 80 Add: Units Started in Process 1,000 Total Units to account for: 1,080 Equivalent Units: Units Material Cost Conversion % Completion Units % Completion Units Units completed 800 100% 800 100% 800 Ending Work in Process 280 100% 280 60% 168 Total Equivalent units 1080 1,080 968

Related Questions

Navigate

• Browse (All)
• Browse Q
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.