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# Process Costing

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At the start of November, Penco Refinery had Work in Process Inventory consisting of 3,000
units that were 85 percent complete with respect to materials and 45 percent complete
with respect to conversion costs. The cost of the units was \$35,000 (\$24,000 of material
cost and \$11,000 of labor and overhead). During November, the company started 45,000
units and incurred \$418,200 of material cost and \$390,700 of labor and overhead. The
company completed 44,000 units during the month and 4,000 units were in process at
the end of October. The units in ending Work in Process were 90 percent complete with
respect to materials and 50 percent complete with respect to conversion costs.

Required
a. Calculate the cost per equivalent unit for materials and conversion costs.
b. Calculate the cost of items completed during October.
c. Calculate the cost of ending Work in Process.
Simon Fishing Co. processes salmon for various distributors. The two departments
involved are Cleaning and Packing. The table below summarizes the data related
to pounds of salmon processed in the Cleaning Department during June:

Pounds of Percent
Salmon Complete*
Work in process, June 1 50,000 60%
Started into processing during June 520,000 ---
Work in process, June 30 40,000 85%

All materials are added at the beginning of the process in the Cleaning Department.

Required
Prepare a reconciliation of units and a computation of equivalent units for June for
the Cleaning Department.
Tropical Sun Ltd. makes suntan lotion in two stages
The lotion is first blended in the Blending Department and then bottled and
packed in the Bottling Department. The information below relates to the operations of
the Blending Department for May.

Percent Completed
Units Materials Conversion

Work in process, beginning 8,000 90% 65%
Started into production 98,000
Completed and transferred out 92,000
Work in process, ending 14,000 75% 30%

Costs (\$)
Work in process, beginning \$7,900 \$9,000
Costs added during May \$106,460 \$145,390

Required
Prepare a production report for the Blending Department for May.