Question

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, 9,000 units, 75% completed $121,725* *Direct materials (9,000 x $10.6) $95,400 26,325 Conversion (9,000 x 75% x $3.9) $121,725 Materials added during January from Weaving Department, 138,800 units $1,485,160 Direct labor for January 245,232 Factory overhead for January 299,728 Goods finished during January (includes goods in process, January 1), 140,400 units Work in process, January 31, 7,400 units, 35% completed a. Prepare a cost of production report for the Cutting Department. If an amount is zero or a blank, enter in "0". 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 to production: Inventory in process, January 1 Received from Weaving Department Total units accounted for by the Cutting Department

Answer 1

Karachi Carpet Company
Cost of Production Report-Cutting Department
For the Month Ended January 31
Unit Information
Units charged to production:
Inventory in process, January 1			9000
Received from weaving Department			138800
Total units accounted for by the Cutting Department			147800
Units to be assigned costs:
		Equivalent Units
	Whole Units	Direct Materials	Conversion
Inventory in process, January 1	9000	0	2250
Started and completed in January	131400	131400	131400
Transferred to Finished goods in January	140400	131400	133650
Inventory in process, January 31	7400	7400	2590
Total units to be assigned costs	147800	138800	136240
Cost Information
Costs per equivalent unit:
		Direct Materials	Conversion
Total costs for January in Cutting Department		1485160	544960
Total equivalent units		138800	136240
Cost per equivalent unit		10.70	4.00
Costs charged to production:
	Direct Materials	Conversion	Total
Inventory in process, January 1			121725
Costs incurred in January			2030120
Total costs accounted for by the Cutting Department			2151845
Cost allocated to completed and partially completed units:
Inventory in process, January 1 balance			121725
To complete inventory in process, January 1	0	9000	9000
Cost of completed January 1 work in process			130725
Started and completed in January	1405980	525600	1931580
Transferred to Finished goods in January			2062305
Inventory in process, January 31	79180	10360	89540
Total costs assigned by the Cutting Department			2151845
2
	Increase or Decrease	Amount
Change in direct materials cost per equivalent unit	Increase	0.10	=10.7-10.6
Change in conversion cost per equivalent unit	Increase	0.10	=4-3.9