Remington Inc. is contemplating the use of process costing to track the costs of its operations....

Remington Inc. is contemplating the use of process costing to track the costs of its operations. The operation consists of three segments (departments): Receiving, Shipping, and Delivery. Containers are received at Remington’s docks and sorted according to the ship they will be carried on. The containers are loaded onto a ship, which carries them to the appropriate port of destination. The containers are then off-loaded and delivered to the Receiving Department.

Remington wants to begin using process costing in the Shipping Department. Direct materials represent the fuel costs to run the ship, and “Containers in transit” represents work in process. Listed below is information about the Shipping Department’s first month’s activity.

Containers in transit, April 1	0
Containers loaded	1,190
Containers in transit, April 30	360,	40%	of direct materials and
		20%	of conversion costs

(a) Determine the physical flow of containers for the month.

Physical flow of containers

(b) Calculate the equivalent units for direct materials and conversion costs.

		Materials		Conversion Costs
Equivalent units

Expert Solution

(a) Calculation of physical flow of containers for the month.

Physical flow of containers = 1,190

(b) Calculation for equivalent units for direct material and conversion cost.

Particulars	Total unit	Direct material	Conversion Cost
Container loaded during month	830	830	830
% of completion	1.00	1.00	1.00
	830	830	830
Containers in transit	360	360	360
% of completion	1.00	0.40	0.20
	360	144	72
Total equivalent unit	1,190	974	902

ekkarill92 answered 1 year ago

Nanjing Company uses a process costing system to track production costs. It operates three departments in...

Nanjing Company uses a process costing system to track production costs. It operates three departments in its production process. Production data for Department #2 for the month of November is given below: Units Percent complete withrespect to DM Beginning work in process inventory 7,300 40 % Transferred in from Department #1 during November 37,500 Completed and transferred to Department #3 during November 35,600 Ending work in process inventory 9,200 70 % DM is added evenly throughout the process. What were the equivalent...

What are some of the virtues of standard costs as use in process costing?

Shalder Custom Fridges uses a job costing system to measure and track product costs for its...

Shalder Custom Fridges uses a job costing system to measure and track product costs for its line of custom-made, highly prestigious premium quality fridges, to allocate overhead costs to its products. Overhead costs are expected to be $110 000. The best estimate for production time in the upcoming year is 22 000 direct labour hours. Production data for the first quarter of the year for the following four types of custom fridges (Freeze, Winter, Ice, and Snow fridge types) is...

Creative Web Design uses a job-order costing system to track the costs of its web design...

Creative Web Design uses a job-order costing system to track the costs of its web design projects. The company provides complete website design and hosting services. The following table provides data concerning the three design projects that were in process during May. There was no work in process at the beginning of May: Project Car City Jan’s Flowers Happy Daycare Designer-hours 90 70 25 Direct labour cost $ 2,430 $ 1,960 $ 950 Actual overhead costs were $4,750 for May....

The basic document for keeping track of costs in a job order costing system is a...

The basic document for keeping track of costs in a job order costing system is a a. process cost report. b. job order cost card. c. labor time card. d. materials requisition form. Which of the following products probably would be manufactured using a job order costing system? a. Computer monitors b. Baseball bats c. Company business cards d. Paper Which of the following is not a characteristic of a process costing system? a. Manufacturing costs are grouped by processes,...

Greasy Nutritional Products, Inc. uses weighted-average process costing to account for its production costs. Conversion cost...

Greasy Nutritional Products, Inc. uses weighted-average process costing to account for its production costs. Conversion cost is added evenly throughout the process, whereas direct materials are added at the beginning of the process. During December, the company transferred 1,090,000 units of product to finished goods. The company started 950,000 units in December. At the end of December, the work in process inventory consists of 670,000 units that are 20% complete with respect to conversion. Beginning inventory had $1,190,000 of direct...

Rigby Ltd accumulates costs for its single product using process costing.

Rigby Ltd accumulates costs for its single product using process costing. Direct material is added at the beginning of the production process, and conversion activity occurs uniformly throughout the process. The following is a partially completed production report for May.Production report, MayPhysicalunitsPercentage ofcompletion with respectto conversionEquivalent unitsDirect materialsConversionWork in process, 1 May25,00040%Units started during May30,00055,000Units completed and transferred out during May35,00035,00035,000Work in process, 31 May20,00080%20,00016,000Total units accounted for55,000Direct materialConversionTotalWork in process, 1 May$143,000$474,700$617,700Costs incurred during May$165,000$2,009,000$2,174,000Total costs to account for$308,000$2,483,700$2,791,700Required:a)...

Briefly explain the underlying logic of a process costing system and its assignment of costs to...

Briefly explain the underlying logic of a process costing system and its assignment of costs to products . Give an example of a company (or its product ) that would most likely use process costing

Process Order Costing: Define Process order costing. Trace the flow of costs through a process order...

Process Order Costing: Define Process order costing. Trace the flow of costs through a process order costing system. Explain the concept and calculation of equivalent units of production. Discuss the production report as a decision making tool.

Variable Costing, Absorption Costing. During its first year of operations, Snobegon, Inc. (located in Lake Snobegon,...

Variable Costing, Absorption Costing. During its first year of operations, Snobegon, Inc. (located in Lake Snobegon, Minnesota), produced 40,800 plastic snow scoops. Snow scoops are oversized shovel-type scoops that are used to push snow away. Unit sales were 38,100 scoops. Fixed overhead was applied at $0.70 per unit produced. Fixed overhead was underapplied by $2,700. This fixed overhead variance was closed to Cost of Goods Sold. There was no variable overhead variance. The results of the year’s operations are as...

Question