Question

Prepare a production cost report for July 20XX. Assume materials are added at the beginning of the production process and the following cost and production data. Production Data - Basketballs Units WIP units 7/1 500 Units started into production 1,600 WIP units 7/31 600 % Complete 60% 1,600 40% 40% $540 Cost Data - Basketballs WIP 7/1 Materials Conversion Costs Labor $300 Overhead 200 500 Total WIP 7/1 $1.040 Costs added during month: Direct materials Direct labor Manufacturing overhead $2,400 $1,600 $1,380

Answer 1

Solution:

Cost charged to production:
Beginning Work In Process	$1,040.00
Cost Added during period	$5,380.00
Total costs to account for	$6,420.00
Total costs accounted for	$6,420.00
Difference due to rounding cost per unit	$0.00
Units reconciliation:
Units to accounts for:
Beginning WIP	500
Units started	1600
Total units to account for	2100
Total units accounted for:
Units completed and transferred out	1500
Units in ending WIP	600
Total units accounted for	2100

Production cost Report
Particulars	Units	% Materials	Material	% Conversion	Conversion
Equivalent units of production - Weighted Average method
Unit completed & Transferred out	1500	100%	1500	100%	1500
Ending Work In Proces	600	100%	600	40%	240
Equivalent units of production	2100		2100		1740
Cost per equivalent unit of production			Material		Conversion
Beginning Work In Process			$540.00		$500.00
Cost added during the period			$2,400.00		$2,980.00
Total costs		Cost	$2,940.00	Cost	$3,480.00
Equivalent units of production		EUP	2100	EUP	1740
Cost per equivalent unit			$1.40		$2.00
Cost Assignment and Reconciliation:
Cost of unit transferred out	EUP	Cost per EUP	Total Cost
Direct materials	1500	$1.40	$2,100.00
Conversion	1500	$2.00	$3,000.00
Total costs transferred out			$5,100.00
Cost of ending work in process
Direct materials	600	$1.40	$840.00
Conversion	240	$2.00	$480.00
Total Cost of ending work in process			$1,320.00
Total costs accounted for			$6,420.00