Question

Problem 16-3A (Part Level Submission) Seagren Industries Inc. manufactures in separate processes furniture for homes. In each process, materials are entered at the beginning, and conversion costs are incurred uniformly. Production and cost data for the first process in making two products in two different manufacturing plants are as follows. Cutting Department Plant 1 plant 2 T12-Tables C10-Chairs Production Data-July Work in process units, July 1 Units started into production Work in process units, July 31 Work in process percent complete 21.280 3,360 to 17,920 560 Cost Data-July Work in process, July 1 Materials Labor Overhead Total 425,600 262,304 116,400 $804,384 $0 322,560 123,200 108,304 5554,064 Your answer is partially correct. Try again. For each plant: (1) Compute the physical units of production. C10 Chairs 112 Tables 17920 Units to be accounted for 17.360 (2) Compute equivalent units of production for materials and for conversion costs. Materials Conversion Costs 19936 19936 T12 Tables C10 Chairs 17,696 17,696

Answer 1

Solution: Amount 17,920 560 Particulars Units Started Work in progress units Completed % Completed work in progress units Finished units Equivalent units Amount 21,280 3,360 60% 2,016 17,920 19,936 80% 448 =Work in progress units X Completed% 17,360 =Units started - Work in progress units 17,808 = Completed work in progress units + Finished units (1) Compute the physical unit of production. Particulars T12 Tables Units to be accounted for 21,280 C10 Chairs 17,920 =Complete units started (2) Compute equivalent unit of production for materials and conversion costs. Conversion Materials Particulars cost T12 Tables 21,280 19,936 Self Explainatory as the values come from above table C10 Chairs 17,9201 17,808 Self Explainatory as the values come from above table

(3) Determine the unit costs of production. Materials Conversion cost Total Cost Particulars Unit cost-T12 Tables Unit cost-C10 Chairs 39 To arrive at the material cost per unit, direct material cost is divided by units started. Conversion cost 15 includes direct labor and Overhead. Conversion cost per unit is arrived by dividing it to Equivalent units. (4) Show the assigment of costs to units transferred out and in process. T12 Tables Particulars Amount Amount Transferred out 6,98,808|= Completed units multiplied by total cost 67,200 Work in Progress Material Conversion Cost Total Cost = Materials cost per unit multiplied by work in progress units 1,05,496 = Conversion cost per unit multiplied by completed work in progress units 8,04,304 C10 Chairs Amount Particulars Transferred out Amount 2,57,223|= Completed units multiplied by total cost 1.018 Work in Progress Material Conversion Cost Total Cost 5,824 = Materials cost per unit multiplied by work in progress units 6,842 = Conversion cost per unit multiplied by completed work in progress units 2,64,064