Question

Cost of Production Report The Cutting Department of Karachi Carpet Company provides the following data for January. Assume that all materials are added at the beginning of the process. Work in process, January 1, 14,000 units, 75% completed $168,000* *Direct materials (14,000 x $7.80) $109,200 Conversion (14,000 x 75% * $5.60) 58,800 $168,000 Materials added during January from Weaving Department, 215,600 units $1,714,020 Direct labor for January 525,344 Factory overhead for January 642,086 Goods finished during January (includes goods in process, January 1), 218,200 units Work in process, January 31, 11,400 units, 40% completed a. Prepare a cost of production report for the Cutting Department. If an amount is zero or a blank, enter in "O". For the cost per equivalent unit computations, round your answers to two decimal places. Karachi Carpet Company Cost of Production Report-Cutting Department For the Month Ended January 31 Unit Information Units charged production: Inventory in process, January Received from Weaving Department Total units accounted for by the Cutting Department Units to be assigned costs: whole Units Equivalent Units Direct Materials Conversion

Answer 1

B A с D 1 Karachi Carpet Company 2 Cost of Production Report-Cutting Department 3 For the Month Ended January 31 4 Unit Information 5 Units charged to production: 6 Inventory in process, January 1 14,000 7 Received from weaving Department 215,600 8 Total units accounted for by the Cutting Department 229,600 9 Units to be assigned costs: 10 Equivalent Units 11 Whole Units Direct Materials Conversion 12 Inventory in process, January 1 14,000 3,500 13 Started and completed in January 204,200 204,200 204,200 14 Transferred to finished goods in January 218,200 204,200 207,700 15 Inventory in process, January 31 11,400 11,400 4,560 16 Total units to be assigned costs 229,600 215,600 212,260 Cost Information 18 Costs per equivalent unit: 19 Direct Materials Conversion 20 Total costs for January in Cutting Department $ 1,714,020 $ 1,167,430 21 Total equivalent units 215600 212260 22 Cost per equivalent unit $ 7.95$ 5.50 23 Costs assigned to production: 17

Direct Materials Conversion Total $ 168,000 $ 2,881,450 $ 3,049,450 24 25 Inventory in process, January 1 26 Costs incurred in January 27 Total costs accounted for by the Cutting Department 28 Costs allocated to completed and partially completed units: 29 Inventory in process, January 1 balance 30 To complete inventory in process, January 1 31 Cost of completed January 1 work in process 32 Started and completed in January 33 Transferred to finished goods in January 34 Inventory in process, January 31 35 Total costs assigned by the Cutting Department 36 $ $ $ 1,623,390$ $ 168,000 19,250 $ 19,250 $ 187,250 1,123,100 $ 2,746,490 $ 2,933,740 25,080 $ 115,710 $ 3,049,450 $ 90,630$ 37 Increase or Decrease Amount Increase $ Decrease $ 38 Change in direct materials cost per equivalent unit 39 Change in conversion cost per equivalent unit 0.15 0.10

D N A B С 1 Karachi Carpet Company Cost of Production Report-Cutting Department 3 For the Month Ended January 31 4 Unit Information 5 Units charged to production: 6 Inventory in process, January 1 14000 7 Received from weaving Department 215600 8 Total units accounted for by the Cutting Department =+B6+B7 9 Units to be assigned costs: 10 Equivalent Units 11 Whole Units Direct Materials Conversion 12 Inventory in process, January 1 14000 =+B12*(100%-100%) =+B12* (100%-75%) 13 Started and completed in January =+B14-B12 =+B13*100% =+B13*100% 14 Transferred to finished goods in January 218200 =+C12+C13 =+D12+D13 15 Inventory in process, January 31 11400 =+B15*100% =+B15*40% 16 Total units to be assigned costs =+B14+B15 -+C14+C15 =+D14+D15 17 Cost Information 18 Costs per equivalent unit: 19 Direct Materials Conversion 20 Total costs for January in Cutting Department 1714020 =525344+642086 21 Total equivalent units =+C16 =+D16 22 Cost per equivalent unit =+C20/021 =+D20/D21 23 Costs assigned to production:

24 Direct Materials Conversion Total 168000 =+C20+D20 =+D25+D26 168000 =+C12*C22 =+D12*D22 =+B30+C30 25 Inventory in process, January 1 26 Costs incurred in January 27 Total costs accounted for by the Cutting Department 28 Costs allocated to completed and partially completed units: 29 Inventory in process, January 1 balance 30 To complete inventory in process, January 1 31 Cost of completed January 1 work in process 32 Started and completed in January 33 Transferred to finished goods in January 34 Inventory in process, January 31 35 Total costs assigned by the Cutting Department 36 =+D29+D30 =+C13*C22 =+D13*D22 =+B32+C32 =+D31+D32 =+B34+C34 =+C15°C22 =+D15*D22 =+D33+D34 37 38 Change in direct materials cost per equivalent unit 39 Change in conversion cost per equivalent unit Increase or Decrease Amount Increase =7.95-7.8 Decrease =5.6-5.5