Exercise 4

AB Sdn. Bhd. (ABSB) produces cheese cakes using a process-costing system (FIFO method) involving TWO (2) departments: Baking and Finishing. The ingredients of the cheese cake are added and mixed at the beginning of the process in the Baking Department.

Data for the month of September 2016 for Baking Department are as follows:

Physical Units:
Beginning work in process inventory	40	(80% complete for conversion)
Units started	560
Units to account for	600
Beginning work in process inventory	40
Started and completed	530
Ending work in process inventory	30	(60% complete for conversion)
Units accounted for	600
Costs:
Beginning work in process inventory:	RM
Materials	651
Conversion	405
Costs added:
Materials	6,720
Conversion	10,008
Total costs to account for	17,784

After they were baked, the cakes are then transferred to the Finishing Department, where they are filled with fruits and jam toppings. The toppings are added at the beginning of the process in the Finishing Department. Finally, they are placed on a hard paper plate and ready to be put on the shelves for sale. Beginning work in process inventory and the current information is listed below:

Beginning work in process inventory:
30 units, 70% complete for conversion
Transferred-in	RM0
Materials	RM90
Conversion	RM98
Current costs added:
Materials	RM1,710
Conversion	RM2,775
Ending work in process inventory:
40 units, 40% complete for conversion

REQUIRED:

(a) For the Finishing Department, calculate the followings:

(i) Equivalent units for the following categories: transferred-in, materials and conversion.

(ii) Cost per equivalent unit for following categories: transferred-in, materials and conversion.

3. Cost of finished cakes at the end of the month.

4. Cost of ending work in process inventory.