B3-M2

Question 1

Cost of jobs completed=

Answer 1

direct materials used + direct labor + overhead applied +beginning work in progress - ending work in progress

Question 2

Job-order costing

Answer 2

• the method of product costing that identifies the job as the cost objective
• best for customized prodution
• new record would be started for every new job

Question 3

Process costing

Answer 3

averages costs and applies them to a large # of homogeneous items

• mass production
• costs accumulated by department as opposed to job

Question 4

Equivalent unit

Answer 4

• fully completed and partially completed units during the period
• used in process costing

Question 5

Weighted average method

Answer 5

1. Compute equivalent units of production
2. Compute the unit cost of production
3. Apply unit costs to the equivalent units in ending inventory
4. Equivalent units= units completed and transfered out + (ending WIP* % COMPLETED)
5. Total costs= Costs in beginning WIP + Costs incurred during the current period
   Weighted avg= Total costs/ equivalent units
6. (Total units* %complete)* Cost per unit

Question 6

FIFO method

Answer 6

beginning WIP * % TO BE completed
+Units completed- Beginning WIP
+ (ending WIP * % completed)
=Equivalent units

Total costs= Costs incurred during the current period

Question 7

Formula for cost of goods manufactured

Answer 7

WIP beginning (Beg inventory)
\+ Direct materials 
\+ Direct labor
\+ Manufacturing overhead
- WIP (ending)
=Cost of goods man (Ending inventory)

Question 8

Spoilage accounting treatment

Answer 8

Normal- inventoriable cost
(units* % sold)
Abnormal- period cost

Question 9

Estimated product cost (Production costs) (Total manufacturing costs)

Answer 9

Direct labor + Direct materials + overhead applied

Question 10

Actual vs applied overhead

Answer 10

Actual- overall factory overhead costs

Applied- overhead costs relevant to one job

Question 11

Formula for COGS

Answer 11

=Finished goods beg bal (Beg inventory)
Add: Costs of goods manufactured (Purchases)
Less: Finished goods-ending bal (Ending inventory)