Question

Work in Process-Assembly Department Bal., 9,000 units, 40% completed 72,360 To Finished Goods, 41,500 units Direct materials, 40,000 units @ 272,000 $6.80 Direct labor 80,000 Factory overhead 40,450 Bal., 2 units, 30% completed Cost per equivalent units of $6.80 for Direct Materials and $3.00 for Conversion Costs. a. Based on the above data, determine the different costs listed below. 1. Cost of beginning work in process inventory completed this period 2. Cost of units transferred to finished goods during the period 3. Cost of ending work in process inventory $ 4. Cost per unit of the completed beginning work in process inventory (Rounded to the nearest cent.) b. Did the production costs change from the preceding period? c. Assuming that the direct materials cost per unit did not change from the preceding period, did the conversion costs per equivalent unit increase, decrease, or remain the same for the current period? Check My Work < Previous Next >

Answer 1

a.

1.

Beginning WIP	72360
Completed this month	16200	[5400*3]
Cost of beginning work in process completed in December	88560

2 . Cost of units transferred to finished goods during the period = 88560 + 318500 = 407060

Direct Materials	221000
Direct Labor	97500
Cost of units started and completed during December	318500

3.

Direct Materials	51000
Direct Labor	6750
Cost of the ending WIP	57750

4. Cost per equivalent unit of beginning WIP = 88560/9000 = 9.84

b. Yes

c. Increase

Workings:

WIP, beginning inventory	9000
Started during the month	40000
Total physical units accounted for	49000
Units processed
Beginning WIP	9000
Transferred out	32500
Ending WIP	7500
Total physical units accounted for	49000

Units to account for	Units	% of completion	Equivalent units Materials	% of completion	Equivalent units Materials
Beginning WIP	9000			60%	5400
Completed	32500	100%	32500	100%	32500
WIP,ending	7500	100%	7500	30%	2250
Total			40000		40150

Cost per equivalent unit
Costs	Materials	Conversion costs	Total
Costs added during the current month	272000	120450	392450
Divided by :Total EUP	40000	40150
Cost per equivalent unit	6.80	3.00	9.80