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Test Company uses a normal, process costing system to determine product cost. The company uses the first-in, first-out (FIFO) method to account for equivalent units and costs in beginning work-in-process. The product passes through two departments: Department 1 and Department 2. In Department 2, all direct materials are added at the beginning of the process. The following information is available for Department 2 in July. Work-in-process, July 1 Units Costs Direct materials Conversion cost Transferred-in cost July activity Units Transferred in Completed and transferred out Costs added Direct materials Conversion cost Transferred-in-cost Percentage of completion Work-in-process, July 1 Work-in-process July 31 5,000 units $25,000 16,000 20,000 50,000 units 45,000 units $400,000 184,000 200,000 60% 40%

Test Company uses a normal, process costing system to determine product cost. The company uses the first-in, first-out (FIFO) method to account for equivalent units and costs in beginning work-in-process. The product passes through two departments: Department 1 and Department 2. In Department 2, all direct materials are added at the beginning of the process. The following information is available for Department 2 in July. Work-in-process, July 1 Units Costs Direct materials Conversion cost Transferred-in cost July activity Units Transferred in Completed and transferred out Costs added Direct materials Conversion cost Transferred-in-cost Percentage of completion Work-in-process, July 1 Work-in-process July 31 5,000 units $25,000 16,000 20,000 50,000 units 45,000 units $400,000 184,000 200,000 60% 40%

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter6: Process Costing
Section: Chapter Questions
Problem 17E: K-Briggs Company uses the FIFO method to account for the costs of production. For Crushing, the...
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Determine the total cost transferred out for July.

Determine the total cost of work-in-process inventory as of July 31.

Test Company uses a normal, process costing system to determine product cost. The company uses the first-in, first-out (FIFO) method to account for equivalent units and costs in beginning work-in-process. The product passes through two departments: Department 1 and Department 2. In Department 2, all direct materials are added at the beginning of the process. The following information is available for Department 2 in July. Work-in-process, July 1 Units Costs Direct materials Conversion cost Transferred-in cost July activity Units Transferred in Completed and transferred out Costs added Direct materials Conversion cost Transferred-in-cost Percentage of completion Work-in-process, July 1 Work-in-process July 31 5,000 units $25,000 16,000 20,000 50,000 units 45,000 units $400,000 184,000 200,000 60% 40%
Transcribed Image Text:Test Company uses a normal, process costing system to determine product cost. The company uses the first-in, first-out (FIFO) method to account for equivalent units and costs in beginning work-in-process. The product passes through two departments: Department 1 and Department 2. In Department 2, all direct materials are added at the beginning of the process. The following information is available for Department 2 in July. Work-in-process, July 1 Units Costs Direct materials Conversion cost Transferred-in cost July activity Units Transferred in Completed and transferred out Costs added Direct materials Conversion cost Transferred-in-cost Percentage of completion Work-in-process, July 1 Work-in-process July 31 5,000 units $25,000 16,000 20,000 50,000 units 45,000 units $400,000 184,000 200,000 60% 40%
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