Question
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 | 1,200 | |||
| Containers in transit, April 30 | 340, | 40% | of direct materials and | |
| 20% | of conversion costs |
(a) Determine the physical flow of containers for
the month.
| Physical flow of containers |
Type your answer here |
(b) Calculate the equivalent units for direct
materials and conversion costs.
Homework Answers
Answer #1
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