Costs per Equivalent Unit The following information concerns production in the B
ID: 342132 • Letter: C
Question
Costs per Equivalent Unit The following information concerns production in the Baking Department for March. All direct materials are placed in process at the beginning of production ACCOUNT Work in Process-Baking Department ACCOUNT NO Balance Date Item Debit Credit Debit Credit 13,986 206,766 257,276 285,684 10,176 10,176 Mar. 1 Bal., 6,300 unlts, 4/5 completed 31 Dlrect materlals, 113,400 units 31 DIrect labor 31 Factory overhead 31 Goods finished, 114,900 units 31 Bal. ? units, 3/5 completed 192,780 50,510 28,408 275,508 a. Based on the above data, determine each cost listed below. Round "cost per equivalent unit" answers to the nearest cent. 1. Direct materials cost per equivalent unit. 2. Conversion cost per equivalent unit. 3. Cost of the beginning work in process completed during March 4. Cost of units started and completed during March 5. Cost of the ending work in process b. Assuming that the direct materials cost is the same for February and March, did the conversion cost per equivalent unit increase, decrease, or remain the same in March? Decrease Increase Remain the sameExplanation / Answer
UNITS TO ACCOUNT FOR: Beginning Work in Process units 6,300 Add: Units Started in Process 113,400 Total Units to account for: 119,700 UNITS TO BE ACCOUNTED FOR: Units completed from Beginning WIP 6300 Units started and completed 108,600 Ending Work in Process 4,800 Total Units to be accounted for: 119,700 Equivalent Units: Material Cost Conversion % Completion Units % Completion Units Units completed from Beg. WIP 0% 0 20% 1,260 Units started and completed 100% 108,600 100% 108,600 Ending Work in Process 100% 4,800 60% 2,880 Total Equivalent units 113,400 112,740 COST PER EQUIVALENT UNIT: Material Conversion Total cost added during the year 192,780 78,918 Equivalent Units 113,400 112,740 Cost per Equivalent unit 1.7 0.7 TOTAL COST ACCOUNTED FOR: Units Completed from Beginning WIP (6300 units) Equivalent unit Cost per EU Total Cost Beginning Cost 13986 Material 0 1.7 0 Conversion Cost 1,260 0.7 882 Cost of units completed from Beg WIP 14868 Units started and Transferred out (108600 units) Equivalent unit Cost per EU Total Cost Material 108,600 1.7 184620 Conversion Cost 108,600 0.7 76020 Total Cost of Units completed and transferred out: 260640 Ending Work in process (4800 units) Equivalent unit Cost per EU Total Cost Material 4,800 1.7 8160 Conversison Cost 2,880 0.7 2016 Total cost of Ending Work in process: 10,176 Req 1: Direct material ccost per unit: $ 1.70 per unit Req 2: Conversion cost per unit: $ 0.70 per unit Req 3: Cost of beginning WIP completed during the year: $ 14,868 Req 4: Cost of units started and completed: $ 260,640 Req 5: Cost of ending WIP: $ 10,176 Req b: Beginning WIP cost: 13986 Less: Material cost inccluded (6300 units @$1.70) -10710 Conversion cost in WIP 3276 Divide : number of equivalent units of CC (6300*80%) 5040 Conversion cost per unit 0.65 Increase, Conversion cost has been icnrease from 0.65 to $0.70 per unit