Question

Cooperative San José of southern Sonora state in Mexico makes a unique syrup using cane sugar and local herbs. The syrup is sold in small bottles and is prized as a flavoring for drinks and for use in desserts. The bottles are sold for $12 each. The first stage in the production process is carried out in the Mixing Department, which removes foreign matter from the raw materials and mixes them in the proper proportions in large vats. The company uses the weighted-average method in its process costing system A hastily prepared report for the Mixing Department for April appears below: Units to be accounted for: work in process, April 1 (materials 90% complete ; conversion 80% complete) Started into production 13,700 34,300 48,000 Total units to be accounted for Units accounted for as follows: 36,800 Transferred to next department Work in process, April 30 (materials 75% complete ; 11,200 48,000 conversion 50% complete) Total units accounted for Cost Reconciliation Cost to be accounted for: $ 49,731 129,773 179,504 Work in process, April 1 Cost added during the month Total cost to be accounted for Cost accounted for as follows: Work in Transferred to next department process, April 30 $ 30,464 149,040 $ 179,504 Total cost accounted for Management would like some additional information about Cooperative San José's operations Required 1. What were the Mixing Department's equivalent units of production for materials and conversion for April? 2. What were the Mixing Department's cost per equivalent unit for materials and conversion for April? The beginning inventory consisted of the following costs: materials, $35,346; and conversion cost, $14,385. The costs added during the month consisted of: materials, $90,310; and conversion cost, $39,463 3. How many of the units transferred out of the Mixing Department in April were started and completed during that month? 4. The manager of the Mixing Department stated, "Materials prices jumped from about $2.40 per unit in March to $2.90 per unit in April, but due to good cost control I was able to hold our materials cost to less than $2.90 per unit for the month." Should this manager be rewarded for good cost control? Complete this question by entering your answers in the tabs below. Show less Required 2Required 3 Required 1 Required 4 What were the Mixing Department's equivalent units of production for materials and conversion for April? Materials Conversion Equivalent units of production Required 1 Required 2> Required 1Required 2 Required 3 Required 4 What were the Mixing Department's cost per equivalent unit for materials and conversion for April? The beginning inventory consisted of the following costs: materials, $35,346; and conversion cost, $14,385. The costs added during the month consisted of: materials, $90,310; and conversion cost, $39,463. (Round your answers to 2 decimal places.) Materials Conversion Cost per equivalent unit 〈 Required! Required 3> Required 1 Required 2 Required 3Required 4 How many of the units transferred out of the Mixing Department in April were started and completed during that month? Units started and completed during April K Required 2 Required 4 Required 1 Required 2Required 3Required 4 The manager of the Mixing Department stated, "Materials prices jumped from about $2.40 per unit in March to $2.90 per unit in April, but due to good cost control I was able to hold our materials cost to less than $2.90 per unit for the month." Should this manager be rewarded for good cost control? Yes ONo Required 3 Required 4

Answer 1

	Physical units	Material	Conversion
Units completed	36800	36800	36800
Ending WIP	11200	8400	5600
Equivalent units of production		45200	42400
	Material	Conversion	Total
Cost of beginning WIP	$                             35,346.00	$14,385.00	$   49,731.00
Add Cost added during the period	$                             90,310.00	$39,463.00	$1,29,773.00
Total Cost accounted for	$                          1,25,656.00	$53,848.00	$1,79,504.00
Equivalent units of production	45200	42400
Cost Per Equivalent Units	2.78	1.27
Units Started and completed
Units completed	34300
Less ending WIP	11200
Units Started and completed	23100
Yes manager should be rewared as the cost of material is 2.78 per unit