Gamma Lights Machining Uses the Weighted-Average Method of Process Costing

question 36

Essay

Gamma Lights Machining uses the weighted-average method of process costing.Materials are added at the beginning of the machining process and conversion costs are added evenly throughout the process.The following activity occurred in its' Machining Department during September.
Units:

Costs:

Required:
1.Summarize flow of physical units and compute total equivalent units for three cost categories: transferred-in,direct materials,and conversion costs.
2.Summarize total costs to account for and compute the cost per equivalent unit for each cost category.
3.Assign total costs to (a)units completed and transferred to Finished Goods Inventory and (b)units in September 30 Work in Process Inventory.

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Definitions:

Level of Intangibility

A characteristic of services describing the extent to which they cannot be seen, touched, or possessed physically, impacting how they are marketed and sold.

Advertising Agency

An Advertising Agency is a service-based business dedicated to creating, planning, and handling advertising (and sometimes other forms of promotion) for its clients.

Tutoring Service

A service that provides individualized or group teaching outside of the traditional educational institutions to enhance understanding in specific subjects.

Inventory Carrying Costs

The total costs associated with holding inventory, including storage, insurance, taxes, opportunity costs, and depreciation.