Question

The Welding Department of Healthy Company has the following production and manufacturing cost data for February 2017. All materials are added at the beginning of the process.

Manufacturing Costs						Production Data
Beginning work in process						Beginning work in process		15,000	units, 1/10 complete
Materials		$18,000				Units transferred out		54,600
Conversion costs		14,360		$32,360		Units started		50,900
Materials				200,129		Ending work in process		11,300	units, 1/5 complete
Labor				67,500
Overhead				84,171

Prepare a production cost report for the Welding Department for the month of February. (Round unit costs to 2 decimal places, e.g. 2.25 and all other answers to 0 decimal places, e.g. 1,225.)

HEALTHY MANUFACTURING COMPANY
Welding Department
Production Cost Report
For the Month Ended February 28, 2017

Equivalent Units
Quantities		Physical Units		Materials		Conversion Costs
Units to be accounted for
Work in process, February 1
Started into production
Total units
Units accounted for
Transferred out
Work in process, February 28
Total units

Costs				Materials		Conversion Costs		Total
Unit costs
Total Costs				$		$		$
Equivalent units
Unit costs				$		$		$
Costs to be accounted for
Work in process, February 1								$
Started into production
Total costs								$

Cost Reconciliation Schedule

Costs accounted for
Transferred out								$

Work in process, February 28
Materials						$
Conversion costs

   

Total costs

Answer 1

HEALTHY MANUFACTURING COMPANY
Welding Department
Production Cost Report
For the Month Ended February 28, 2017
	Equivalent units
Quantities	Physical Units	Materials	Conversion Costs
Units to be accounted for
Work in process, February 1	15,000
Started into production	50,900
Total units	65,900
Units accounted for
Transferred out	54,600	54,600	54,600
Work in process, February 28	11,300	11,300 (working note1)	2,260 (working note2)
Total units	65,900	65,900	56,860
Costs	Materials	Conversion Costs	Total
Unit costs
Total costs (working note 3)	218,129	166,031	384,160
Equivalent units	65,900	56,860
Unit costs	3.31	2.92	6.23
Costs to be accounted for
Work in process, February 1			32,360
Started into production			351,800
Total costs			384,160
Cost reconciliation Schedule
Costs accounted for
Transferred out			340,158
Work in process, February 28
Materials		37,403
conversion costs		6,599	44,002
Total costs			384,160

working note

1.Assumed that direct materials are introduced beginning of the production. Hence equivalent units for ending materials is 100% complete.

2.For conversion, Equivalent units for ending work in process = Ending work-in process units x % of completion = 11,300*1/5 = 2,260

3.Total costs

	Materials	Conversion
	units	amount	units	amount
Beginning Work-in process	15,000	18,000		14,360
Started into production	50,900	200,129		151,671 (67,500+84,171)
Units transfered			54,600
Ending Work-in process			2,260 (11,300*1/5)
Total costs	65,900	218,129	56,860	166,031