Mid-term Test Option 2 (ch17) Coat Analysis for February-Msing Departmen Equival
ID: 2341136 • Letter: M
Question
Mid-term Test Option 2 (ch17) Coat Analysis for February-Msing Departmen Equivalent Units Cost per Unit Drect Mateials in inventiory in process, March Conversion costs in inventory in process March $32480 Total cost per unit Determine the cost per unit of direct matenials and or conversion for the month of Manch using the compleed data on the Cost o Production panel Round your per unit computations to the Cest Analysis for Mareh Mixing Department Cost per Costs for Manch Direct Materials Costs for Maroh Conversion 35000 D Total cost per unit asignment Score: 00% 5 6 7 8 9Explanation / Answer
Step for solution
Step 1
Equivalent Units of production = Physical units multiplied by % of competition
Step 2
Calculate total cost to be accounted for
Step 3
Cost per Equivalent Unit =Cost incurred during Month / Equivalent Units of production
Step 4
Cost assigned to units transferred out = Cost in beginning WIP + Cost incurred for complete beginning WIP + Cost of units in Started and completed
Step 5
Cost assigned to units ending work in progress = equivalent units in ending WIP inventory * Cost per Equivalent Unit
For direct material 100% unit completed it means remaining 0% completed in this month.
For conversion cost 35% unit completed it means (100-35) remaining 65% completed in this month.
Grainy Goodness Company
Mixing Department production Report
First in First out (FIFO) Method
Month ended March 31
Summary of Physical units
Units in beginning WIP inventory
2000
Units started during month
38000
Total unit to be accounted for
40000
Units completed and transferred out
37000
Units in ending WIP inventory
3000
Total unit accounted for
40000
Equivalent Units of production
Particulars
Physical units
Direct material
Conversion Cost
%
Units
%
Units
Units in beginning WIP inventory
2000
0%
0
65%
1300
Units in Started and completed (37000-2000)
35000
100%
35000
100%
35000
Units in ending WIP inventory
3000
100%
3000
80%
2400
Equivalent Units of production
38000
38700
Summary of cost to be accounted
Direct material
Conversion Cost
Total
Cost in beginning WIP
2300
525
2825
Cost incurred during Month (Add)
40660
40635
81295
Total cost to be accounted for
42960
41160
84120
Cost per Equivalent Unit
Cost incurred during Month
40660
40635
Equivalent Units of production
38000
38700
Cost per Equivalent Unit
1.07
1.05
2.12
Assign costs to units transferred out and units in ending WIP inventory
Cost assigned to units transferred out
Direct material
2300
Conversion Cost
525
Cost in beginning WIP
2825
Direct material (0*1.07)
0
Conversion Cost (1300*1.05)
1365
Cost incurred for complete beginning WIP
1365
Direct material (35000*1.07)
37450
Conversion Cost (35000*1.05)
36750
Cost of units in Started and completed
74200
Cost assigned to units transferred out
78390
Cost assigned to units ending work in progress
Direct material (3000*1.07)
3210
Conversion Cost (2400*1.05)
2520
Cost assigned to units ending work in progress
5730
Total cost assigned
84120
Cost analysis for February -Mixing department
Amount
Equivalent unit
Cost per unit
Direct material in inventory in progress (2000*100% work completed in Feb)
2300
2000
1.15
Conversion cost in inventory in progress (2000*35% work completed in Feb)
525
700
0.75
Total cost per unit
1.90
Cost analysis for March -Mixing department
Amount
Equivalent unit
Cost per unit
Direct material cost in march
40660
38000
1.07
Conversion cost in march
40635
38700
1.05
Total cost per unit
2.12
Step for solution
Step 1
Equivalent Units of production = Physical units multiplied by % of competition
Step 2
Calculate total cost to be accounted for
Step 3
Cost per Equivalent Unit =Cost incurred during Month / Equivalent Units of production
Step 4
Cost assigned to units transferred out = Cost in beginning WIP + Cost incurred for complete beginning WIP + Cost of units in Started and completed
Step 5
Cost assigned to units ending work in progress = equivalent units in ending WIP inventory * Cost per Equivalent Unit
For direct material 100% unit completed it means remaining 0% completed in this month.
For conversion cost 35% unit completed it means (100-35) remaining 65% completed in this month.