Question

The following information concerns production in the Baking Department for December. All direct materials are placed in process at the beginning of production. ACCOUNT Work in Process-Baking Department ACCOUNT NO. Balance Date Item Debit Credit Debit Credit Dec. 1 Bal., 8,400 units, 4/5 completed 15,456 31 Direct materials, 151,200 units 211,680 227,136 31 Direct labor 58,220 285,356 31 Factory overhead 32,752 318,108 31 Goods finished, 153,300 units 306,264 11,844 31 Bal., 2 units, 4/5 completed 11,844 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 2. Conversion cost per equivalent unit 3. Cost of the beginning work in process completed during December 4. Cost of units started and completed during December 5. Cost of the ending work in process b. Assuming that the direct materials cost is the same for November and December, did the conversion cost per equivalent unit increase, decrease, or remain the same in December? Nimt

Answer 1

1) Direct materials cost per equivalent unit 2) Conversion cost per equivalent unit 3) Cost of the beginning work in process completed during December 4) Cost of units started and completed during December 5) Cost of the ending work in process $ 1.40 $ 0.60 $ 16,464 $ 289,800 $ 11,844 Working Note:

A 1 B с D Equivalent Units Whole Units Direct Materials Conversion 8,400 1,680 144,900 144,900 144,900 153,300 144,900 146,580 6,300 6,300 5,040 159,600 151,200 151,620 Direct Materials Conversion $ 211,680$ 90,972 151,200 151,620 $ 1.40 $ 0.60 2 3 Beginning work in process 4 Units Started and completed 5 Units completed and transferred 6 Ending work in process 7 Total units to be assigned costs 8 9 Costs per equivalent unit: 10 11 Total costs 12 Total equivalent units 13 Cost per equivalent unit 14 Costs charged to production: 15 16 Beginning work in process 17 Costs incurred in December 18 Total costs accounted for 19 Cost allocated to completed and partially completed units: 20 Beginning work in process 21 To complete beginning inventory in process 22 Cost of beginning work in process completed 23 Cost of units Started and completed 24 Cost of units completed and transferred 25 Cost of the ending work in process 26 Total costs assigned by the Roasting Department Direct Materials Conversion Total $ 15,456 $ 302,652 $ 318,108 $ $ $ 202,860$ 15456 1,008$ 1,008 $ 16,464 86,940 $ 289,800 $ 306,264 3,024 $ 11,844 $ 318,108 $ 8,820 $

А 1 B C D Equivalent Units Whole Units Direct Materials Conversion 8400 =+B3* (100%-100%) =+B3*(1-4/5) =153300-B3 =+B4*100% =+B4*100% =+B3+B4 =+C3+C4 =+D3+D4 =8400+151200-153300 =+B6*100% =+B6*4/5 =+B5+B6 =+C5+C6 =+D5+D6 . Direct Materials 211680 =+C7 =+C11/012 Conversion =58220+32752 =+D7 =+D11/012 2 3 Beginning work in process 4 Units Started and completed 5 Units completed and transferred 6 Ending work in process 7 Total units to be assigned costs 8 9 Costs per equivalent unit: 10 11 Total costs 12 Total equivalent units 13 Cost per equivalent unit 14 Costs charged to production: 15 16 Beginning work in process 17 Costs incurred in December 18 Total costs accounted for 19 Cost allocated to completed and partially completed units: 20 Beginning work in process 21 To complete beginning inventory in process 22 Cost of beginning work in process completed 23 Cost of units Started and completed 24 Cost of units completed and transferred 25 Cost of the ending work in process 26 Total costs assigned by the Roasting Department Direct Materials Conversion Total 15456 =+C11+D11 =+D16+D17 15456 =+C3*C13 =+D3*D13 =+B21+C21 =+D20+D21 =+C4*013 =+D4*D13 =+B23+C23 =+D22+D23 =+C6*C13 =+D6*D13 =+B25+C25 =+D24+D25

A B с 28 b) 29 30 Material cost per equivalent unit (same as December) 31 Material cost of beginning work in process 32 Conversion cost in beginning work in process 33 Equivalent units of conversion 34 Conversion cost per equivalent unit In November 35 Conversion cost per equivalent unit In December 36 Increase in conversion cost per equivalent unit November $ 1.40 $ 11,760 $ 3,696 6720 $ 0.55 $ 0.60 $ 0.05 Increase

B C A 28 b) 29 30 Material cost per equivalent unit (same as December) 31 Material cost of beginning work in process 32 Conversion cost in beginning work in process 33 Equivalent units of conversion 34 Conversion cost per equivalent unit In November 35 Conversion cost per equivalent unit In December 36 Increase in conversion cost per equivalent unit November 1.4 =8400*B30 =15456-B31 =8400*4/5 =+B32/B33 0.6 =+B35-B34 Increase