Question

The following information concerns production in the Baking Department for March. All direct materials are placed in pro production ACCOUNT Work in Process-Baking Department ACCOUNT NO. Balance Date Item Debit Credit Debit Credit Mar. 16,368 1 Bal., 9,300 units, 2/5 completed 31 Direct materials, 167,400 units 31 Direct labor 251,100 267,468 76,850 344,318 43,228 387,546 31 Factory overhead 31 Goods finished, 169,500 units 31 Bal.? units, 4/5 completed 372,714 14,832 14,832 a. Based on the above data, determine each cost listed below. Round "cost per equivalent unit" answers to the nearest cent. 1. Direct materials cost per equivalent unit. 1.50 0.70 2. Conversion cost per equivalent unit. 3. Cost of the beginning work in process completed during March 17,391 x 4. Cost of units started and completed during March $ 352,440 5. Cost of the ending work in process 14,832 b. Assuming that the direct materials cost is the same for February and March, did the conversion cost per equivalent unit increas or remain the same in March? Check My Work Previous

Answer 1

Conversion Cost Beginning Units Started during the month Total Units available Units completed Ending Units Concerns Productions Equivalent Production Units statement- Baking Department For the Month of March Whole Units Direct Materials 9,300 167,400 176,700 (169,500) 7,200 160,200 Calculation of Equivalent Units Beginning Inventory in Process (0,3/5 complete) Units started and completed during the month (169,500 - 9,300) Total units transferred to Finished goods Ending Inventory in Process (1,4/5 complete) Total Equivalent units 9,300 160,200 169,500 7,200 176,700 160,200 7,200 167,400 5,580 160,200 165,780 5,760 171,540

Concerns Productions Equivalent Production Cost statement- Baking Department For the Month of March Total Direct Materials Total cost incurred during the month (a) 371,178 251,100 Equivalent Production units (b) 167,400 Cost per equivalent units (a/b) 1.50 Cost Charged to Production Inventory in process, March 1 16,368 Cost incurred in March 371,178 Total Cost Accounted 387,546 Conversion Cost 120,078 171,540 $ 0.70 Total Direct Materials Conversion Cost 16,368 - 3,906 3,906 20,274 240,300 Cost of Equivalent units Beginnig cost Cost of Beginning completed in March Direct Materials (O units X 1.50) Conversion cost (5,580 units x 0.70) Total Cost of Beginning WIP (a) Cost of Units completed and started during the month Direct Materials ( 160,200 units X 1.50) Conversion cost (160,200 units x 0.70) Total cost of units completed and started during the month (b) Total cost of units completed and started (a+b) Cost of Ending Work in Process Direct Materials ( 7,200 units x 1.50) Conversion cost (5,760 units x 0.70) Total cost of Ending work in process Total cost accounted 112,140 240,300 112,140 352,440 372,714 10,800 4,032 10,800 4,032 14,832 387,546

Ś a) Direct Materials cost per equivalent Units b) Conversion cost per equivalent units c) Cost of Beginning work in process completed during the March d) Cost of units started and completed during March e) Cost of the ending work in process $ $ $ 1.50 0.70 20,274 352,440 14,832 b. Convesrsion cost per equivalent unit will increase in March. $ Direct Material Cost in March Direct Material Units Cost per Unit 251,100 167,400 1.50 $ Cost of Direct Material in beginning Work in process (9,300 x 1.50) Beginning Work in Process Conversion cost in Beginning WIP (16,368 - 13,950) Equivalent unit of Conversion cost on March 1, Beginning WIP (9,300 ~ 2/5) Cost per Equivalent Unit ($ 2,418 /3,720) $ 13,950 16,368 2,418 3,720 0.65 $ Conversion Cost increase from $0.65 to $0.70