Costs per Equivalent Unit and Production Costs The following information concern
ID: 2543342 • Letter: C
Question
Costs per Equivalent Unit and Production Costs The following information concerns production in the Forging Department for November. All direct materials are placed into the process at the beginning of production, and conversion costs are incurred evenly throughout the process. The beginning inventory consists of $74,820 of direct materials. ACCOUNT NO ACCOUNT Work in Process-Forging Date Item Nov. Balance Debit Credit Debit Credit 1 BaL, 5,800 units, 70% completed 30 Direct materials, 53,000 units 30 Direct labor 30 Factory overheacd 30 Goods finished, 2 units 30 Bal., 4,600 units, 70% completed 94,970 758,070 816,340 80,466 ?896,806 673,100 58,270 Based on the above data, determine each of the follawing amounts. If required, round your interim calculations to two decimal places. Round final answers (a-c) to the nearest dollar a. Cost of beginning work in process inventory completed in November b. Cast of units transferred to the next department during November c. Cost of ending work in process inventory on November 30 d. Casts per equivalent unit of direct materials and conversion induded in the November 1 beginning work in process. If required, round your answers to two decimal places. Direct materials cost per equivalent unit Conversion cost per equivalent unit e. The November increase or decrease in costs per equivalent unit for direct materials and conversion from the previous month. If required, round your answers to two decimal places Increase or Decrease Amount Change in direct materials cost per equivalent unit Change in conversion cost per equivalent unitExplanation / Answer
Equivalent Units Whole Units Direct Materials Conversion Inventory in process, November 1 5800 0 1740 Started and completed in November 48400 48400 48400 Transferred to Packing Department in November 54200 48400 50140 Inventory in process, November 30 4600 4600 3220 Total units to be assigned costs 58800 53000 53360 Cost Information Costs per equivalent unit: Direct Materials Conversion Total costs for November in Forging Department 673100 138736 Total equivalent units 53000 53360 Cost per equivalent unit 12.7 2.6 Costs charged to production: Direct Materials Conversion Total Inventory in process, November 1 84970 Costs incurred in November 811836 Total costs accounted for by the Forging Department 896806 Cost allocated to completed and partially completed units: Inventory in process, November 1 balance 84970 To complete inventory in process, November 1 0 4524 4524 Cost of completed November 1 work in process 89494 Started and completed in November 614680 125840 740520 Transferred to finsihed goods in November 830014 Inventory in process, November 30 58420 8372 66792 Total costs assigned by the Forging Department 896806 a Cost of beginning work in process completed = $89494 b Cost of units transferred = $830014 c Cost of ending work in process = $66792 d Direct materials cost per equivalent unit=(74820/5800)= $12.9 Conversion cost per equivalent unit=(84970-74820)/(5800*70%)= $2.5 e Increase or Decrease Amount Change in direct materials cost per equivalent unit Decrease 0.2 Change in conversion cost per equivalent unit Increase 0.1