FLOW OF A COST SYSTEM

Question 1

What are the 4 Stages of the “Flow of a Cost System?”

Answer 1

Raw Materials
WIP
Finished Goods
Costof Goods Sold

Question 2

Formula: Raw Materials

Answer 2

Beg. RM
+ Purchases
= Available

(Ending RM)
= Materials Used (goes to WIP)

Question 3

Formula: WIP

Answer 3

Beg WIP
\+ DM used (from RM)
\+ DL
\+ Applied Mfg. OH
= WIP Available
(Ending WIP)
= COGM

Question 4

Formula: Finished Goods

Answer 4

Beg FG
+ COGM (from WIP)
= Fin. Goods Avail.

(Ending FG)
= C0GS (to cogs)

Question 5

Formula: COGS

Answer 5

COGS
+ underapplied (overapplied)

= COGS