Question

Current Attempt in Progress Polk Company manufactures basketballs. Materials are added at the beginning of the production process and conversion costs are incurred uniformly. Production and cost data for the month of July 2020 are as follows. Percent Complete 60% Units 500 1.000 600 40% Production Data-Basketballs Work in process units, July 1 Units started into production Work in process units, July 31 Cost Data-Basketballs Work in process, July 1 Materials Conversion costs Direct materials Direct labor Manufacturing overhead $750 600 $1,350 2,400 1,580 1,240

Answer 1

Calculation of Equivalent units

	Materials	Conversion
Units completed and transferred	900	900
Ending work in process	(600*100%)= 600	(600*40%)= 240
Equivalent units	1500	1140

Units completed and transferred= Beginning work in process+Units started into production-Ending work in process

= 500+1000-600= 900

Calculation of Cost per equivalent units

	Materials	Conversion
Cost of beginning work in process	$750	$600
Cost incurred during this period	2400	(1580+1240)= 2820
Total costs	$3150	$3420
Equivalent units	1500	1140
Cost per equivalent unit	$2.10	$3

Calculate the assignment of costs to units transferred out and in process at the end

Costs accounted for:
Transferred out ($2.10+3.00)*900		$4590
Work in process, July 31
Materials ($2.10*600)	$1260
Conversion costs ($3*240)	720	1980
Total costs		$6570

Prepare a Production cost report

POLK COMPANY
Basketball Department
Production Cost Report
For the Month Ended July 31, 2020
		Equivalent Units
Quantities	Physical Units	Materials	Conversion Costs
Units to be accounted for
Work in process, July 1	500
Started into production	1000
Total units	1500
Units accounted for
Transferred out	900	900	900
Work in process, July 31	600	(600*100%)= 600	(600*40%)= 240
Total units	1500	1500	1140
Costs		Materials	Conversion Costs	Total
Unit costs
Total costs		$3150	$3420	$6570
Equivalent units		1500	1140
Unit costs		$2.10	$3.00	$5.10
Costs to be accounted for:
Work in process, July 1				$1350
Started into production (2400+1580+1240)				5220
Total costs				$6570
Cost Reconciliation Schedule
Cost accounted for
Transferred out ($5.10*900)				$4590
Work in process, July 31
Materials ($2.10*600)			$1260
Conversion costs ($3.00*240)			720	1980
Total costs				$6570