Cost of Units Completed and in Process The charges to Work in Process—Assembly D
ID: 2418510 • Letter: C
Question
Cost of Units Completed and in Process
The charges to Work in Process—Assembly Department for a period, together with information concerning production, are as follows. All direct materials are placed in process at the beginning of production.
a. Based on the above data, determine the different costs listed below.
b. Did the production costs change from the preceding period?
No
No
Yes
c. Assuming that the direct materials cost per unit did not change from the preceding period, did the The rate used to allocate costs between completed and partially completed production.conversion costs per equivalent unit increase, decrease, or remain the same for the current period?
Increase
Decrease
Increase
Remain the same
Work in Process—Assembly Department Bal., 1,600 units, 35% completed 17,440 To Finished Goods, 29,600 units ? Direct materials, 29,000 units @ $9.50 275,500 Direct labor 84,600 Factory overhead 39,258 Bal. ? units, 45% completed ?Explanation / Answer
Note : as there is no method is mentioned so answer is given by using FIFO method
Balance Closing Unit = Opening + Introduced - Closing = 1,600 + 29,000 - 29,600 = 1,000
Cost per Unit
a)
i) Cost of beginning work in progress
= opening cost + opening equivaent material units X Cost per unit + Opening equivalent overhead unit X cost per unit
= 17,440 + ( 0 X 9.500 ) + ( 1,040 X 4.20)
= 21,808
ii) Cost of units transfered to finished goods i.e 29,600 units
= opening completed goods cost + cost of Units started and completed during year
= 21,808 + (28,000 X 9.50 ) + ( 28,000 X 4.20)
= 405,408
iii) Cost of ending work in progress
= Cost of equivalent material unit X cost per unit + Cost of equivalent overhead units X Cost per unit
= 1,000 X 9.50 + 450 X 4.20
= 11,390
IV) Cost per unit of the completed beginning work in process inventory
= Opening Cost / Opening completed units
= 21,808 / 1,600
= 13.63
b) Yes it is changed by ( 9.50 + 4.20) - 13.63 = $ 0.07
C) Increases
Previous cost = 13.63 - 9.50 = 4.13
Current cost = 4.20
increase = 0.07
Particulars Units %age completed during the year Material %age completed during the year Labor + Factory overhead Cost 275,500 123,858 Equivalent units Opening 1,600 0 0 65% 1,040 Introduced 28,000 100% 28,000 100% 28,000 Closing 1,000 100% 1,000 45% 450 Total 30,600 29,000 29,490 Cost per unit 9.50 4.20