New User Special Price Expires in

Let's log you in.

Sign in with Facebook


Don't have a StudySoup account? Create one here!


Create a StudySoup account

Be part of our community, it's free to join!

Sign up with Facebook


Create your account
By creating an account you agree to StudySoup's terms and conditions and privacy policy

Already have a StudySoup account? Login here

Chapter 5

by: Rachel Moore

Chapter 5 ACCT 2102

Rachel Moore
GPA 3.33

Preview These Notes for FREE

Get a free preview of these Notes, just enter your email below.

Unlock Preview
Unlock Preview

Preview these materials now for free

Why put in your email? Get access to more of this material and other relevant free materials for your school

View Preview

About this Document

These notes cover Chapter 5, which was discussed in class February 8th through February 12th.
Principles of Accounting II
Class Notes
ACCT 2102, uga, Farmer, Chapter 5, Process Costing
25 ?




Popular in Principles of Accounting II

Popular in Accounting

This 3 page Class Notes was uploaded by Rachel Moore on Sunday February 14, 2016. The Class Notes belongs to ACCT 2102 at University of Georgia taught by Farmer in Spring 2016. Since its upload, it has received 264 views. For similar materials see Principles of Accounting II in Accounting at University of Georgia.


Reviews for Chapter 5


Report this Material


What is Karma?


Karma is the currency of StudySoup.

You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!

Date Created: 02/14/16
ACCT 2102 February 8, 2016 – February 12, 2016 Chapter 5 Notes Process Costing What is the ultimate goal of both job order costing and process costing? To get the cost of a unit. What type of manufacturing environment necessitates using process costing? Mass producing. What is the initial cost object in a process costing environment? Processing department. RM Inventory WIP Inventory – D1 WIP Inventory – D2 FG Inventory Beg Use Beg TO* Beg TO Beg COGS Purchase DM+DL+MOH TI+DM+DL+ TI** MOH End End End End *TO – Transferred Out **TI – Transferred In How would we get form the initial cost object to the cost of a unit? Cost ÷ # of units completed = Cost per unit Equivalent Unit Calculation • Physical units x % Complete = EU • Used to fairly assign cost. • EU is how many units I could have completed given the resources that I used. What is moved to Department 2? TO: # of units complete x 100% x cost per unit = D1 TO EI: # of units in process x % complete x cost per completed unit = D1 EI Process Costing Template: • Step 1 – Summarize flow of physical units o Takes a look at where units come from and where they go; BI or S (started) ▯ EI or C&TO • Step 2 – Equivalent unit calculation o DM column includes direct material; conversion column includes DL and MOH • Step 3* - Calculate cost per equivalent unit • Step 4 – Assign costs *Most important for managers. Production Cost Report (Department 1) Step 1 (Physical Units) Step 2 (EU) Beginning Inventory 35,000 DM C Started 385,000 Total units to acct for 420,000 EI 20,000 12,800 Ending Inventory 20,000 C&TO 400,000 400,000 C&TO 400,000 Total units accted for 420,000 Total EU 420,000 412,000 Step 3 (Cost per EU) Step 4 (Assign Costs) DM C Completed & $3.50(400,000) Transferred Out + Costs in BI $122,500 $14,000 $0.80(400,000) Costs added $1,347,500 $25,000 = $290,600 $1,720,000 Total costs $1,470,000 $329,600 Ending $3.50(20,000) Total EU 420,000 412,000 Inventory + $0.80(12,000) Cost per EU $3.50 $0.80 = $79,600 How many physical units did we work on during the month? 420,000 Where did they come from? 35,000 BI; 385,000 Started Where did they go? 20,000 EI; 400,000 C&TO What are the EUs for DM and Conversion? What do these EUs mean? 420,000 DM (how many units I could have completed with respect to all of the DM costs in the period); 412,000 C (how many units I could have completed with respect to all of the C costs in the period) How much did it cost to produce one finished unit in this department? $4.30 What is the Ending WIP balance (beginning WIP balance next period)? $79,600 How much cost is transferred to the next department? $1,720,000 Units started in department 2 during the period are transferred in from department 1. A unit in department 2 is 100% completed in department 1. Beg WIP Department 2 (units) 100,000 units Units Transferred in from the previous 400,000 department Units Completed and Transferred Out 450,000 units Beg WIP Department 2 Transferred in cost in beginning balance $ 430,000 DM cost in beginning balance $10,000 Conversion cost in beginning balance $25,000 Manufacturing costs incurred (added) during the period: Transferred in from the previous $1,720,000 department Direct materials used $895,000 Conversion costs (DL and MOH) $217,500 Production Cost Report (Department 2) Step 1 (Physical Units) Step 2 (EU) Beginning Inventory 100,000 TI DM C Started 400,000 Total units to acct for 500,000 EI 50,000 2,500 35,000 Ending Inventory 50,000 C&TO 450,000 450,000 450,000 C&TO 450,000 Total units accted for 500,000 Total 500,000 452,500 485,000 EU Step 3 (Cost per EU) Step 4 (Assign Costs) TI DM C Completed & $6.80(450,000) Transferred Out = Costs $430,000 $10,000 $25,000 $3,060,000 BI Costs $1,720,000 $895,000 $217,500 Added Total $2,150,000 $905,000 $242,500 Ending Inventory $3.50(20,000) 500,000 452,500 485,000 + Cost $4.30 $2 $0.50 $0.80(12,000) per = $79,600 EU


Buy Material

Are you sure you want to buy this material for

25 Karma

Buy Material

BOOM! Enjoy Your Free Notes!

We've added these Notes to your profile, click here to view them now.


You're already Subscribed!

Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'

Why people love StudySoup

Bentley McCaw University of Florida

"I was shooting for a perfect 4.0 GPA this semester. Having StudySoup as a study aid was critical to helping me achieve my goal...and I nailed it!"

Kyle Maynard Purdue

"When you're taking detailed notes and trying to help everyone else out in the class, it really helps you learn and understand the I made $280 on my first study guide!"

Steve Martinelli UC Los Angeles

"There's no way I would have passed my Organic Chemistry class this semester without the notes and study guides I got from StudySoup."


"Their 'Elite Notetakers' are making over $1,200/month in sales by creating high quality content that helps their classmates in a time of need."

Become an Elite Notetaker and start selling your notes online!

Refund Policy


All subscriptions to StudySoup are paid in full at the time of subscribing. To change your credit card information or to cancel your subscription, go to "Edit Settings". All credit card information will be available there. If you should decide to cancel your subscription, it will continue to be valid until the next payment period, as all payments for the current period were made in advance. For special circumstances, please email


StudySoup has more than 1 million course-specific study resources to help students study smarter. If you’re having trouble finding what you’re looking for, our customer support team can help you find what you need! Feel free to contact them here:

Recurring Subscriptions: If you have canceled your recurring subscription on the day of renewal and have not downloaded any documents, you may request a refund by submitting an email to

Satisfaction Guarantee: If you’re not satisfied with your subscription, you can contact us for further help. Contact must be made within 3 business days of your subscription purchase and your refund request will be subject for review.

Please Note: Refunds can never be provided more than 30 days after the initial purchase date regardless of your activity on the site.