Question

The Cutting Department of Cassel Company has the following production and cost data for July. 1. 2. Production Transferred out 12,500 units. Started 4,500 units that are 60% complete as to conversion costs and 100% complete as to materials at July 31. Costs Beginning work in process Materials Labor Manufacturing overhead $0 68,850 21,700 20,100 Materials are entered at the beginning of the process. Conversion costs are incurred uniformly during the process. (a) Determine the equivalent units of production for (1) materials and (2) conversion costs. Materials Conversion Costs Total equivalent units of production

Answer 1

Total equivalent write of production Materials 17,000 Conversion Costs 15, 200 Calculation: Materials Conversion costs 12,500 12,500 Units transferred out Add: work in process, July 31 (4,500 units & 100%) (4,500 units X 60%) Total equivalent units. 4,500 2,700 17,000 15,200 رط Materials $ 4.05 Conversion costs $ 2.75 Calculation: Materials cost per unit = (Total Material cost & total equivalent units of materials $60,850 - 17,000 $4.05 Conversion cost per unit (Total Labor cost + To tal manufacturing overhead) - Total equivalent units of conversion costs = ($21,700 + $20,100) & 15,200 $ 41,000 & 15,200 . - = $2.75

Cost Reconciliation Costs accounted for Add: Transferred out $ 85,000 Work in process, July 31 Materials $ 18, 225 Conversion costs $ 7,425 $25,650 Total costs $ 110,650 Calculation : Total cost per unit $4.05 + $2.75 = $ Godo recated also transferred out 12,500 units x $6.80 $ 85,000 Material 4,500 x $4.05 per unit = $ 10,225 Conversion costs = 2,700 x $2.75 per unit $ 7,425