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Question

? 1 1 I U ale X2 | X2 | | A , I e I, ? 1.1 | Paragraph | Styles 32 questions ACCOUNTING 18 TEST2 4/5/2018 Chicotti Company has 6000 units in beginning WIP, 30% complete as to conversion cost. 60000 units transferred out to finished goods and 2000 units in Ending wiP, 20% complete as to conversion cost. The beginning and ending is fully complete as to materials cost How much as equivalent units for conversion cost if the FIFO method is used? 1. a. 60400 b. 64600 C. 56000 d. 58600 2. A department had the following information for the month: Total Materials Cost: Conversion Cost/Unit Total Manufacturing Cost/Unit: $5.00 $210,000 $3.00 What are the equivalent units of production for materials? a. 105,000 b. 70,000 C. 72000 d. Cannot be determined 3. Addison company manufactures 2 products, Regular and Supreme. Addisons OVERHEAD Cost consists of machining $2,500,000 and assembling $1,250,000. Information on the two products is as follows: Regular Supreme Direct Labor Hours: Machine Hours: Number of parts: 10,000 10,000 90,000 15,000 30,000 160,000 Overhead applied to Supreme using Activity based costing is a. 1,075,000 b. 1,500,000 Focus 110% Beginning a Intermediate A

Explanation / Answer

Q1. Answer is d. 58600 units Explanation: UNITS TO ACCOUNT FOR: Beginning Work in Process units 6,000 Add: Units Started in Process 56,000 Total Units to account for: 62,000 UNITS TO BE ACCOUNTED FOR: Units completed from Beginning WIP 6000 Units started and completed 54,000 Ending Work in Process 2,000 Total Units to be accounted for: 62,000 Equivalent Units: Material Cost Conversion % Completion Units % Completion Units Units completed from Beg. WIP 0% 0 70% 4,200 Units started and completed 100% 54,000 100% 54,000 Ending Work in Process 100% 2,000 20% 400 Total Equivalent units 56,000 58,600 Q2. Answer is a. 105000 units Explanation: Total material cost: 210,000 Material cost per unit (5.00-300) 2 Equivalent unints of material 105000 Q3. Answer is $2625000 Explanation: STATEMENT SHOWING ACTIVITY RATE OF ACTIVITY POOL Activity Total Expected Activity ACTIVITY COST POOL Measures Overheads Activity Rate Machining MH 2,500,000 40,000 62.5 Assembling DLH 1,250,000 25,000 50 Overhead applied to Supreme: Machining (30,000 Mh @62.50) 1875000 Assembling (15000 DLH @ 50) 750000 Total Overheads assigned 2625000

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