Question

The following information concerns production in the Baking Department for May. All direct materials are placed in process at the beginning of production.

ACCOUNT Work in Process—Baking Department							ACCOUNT NO.
Date		Item	Debit		Credit		Balance
							Debit		Credit
May.	1	Bal., 7,200 units, 1/3 completed					12,360
	31	Direct materials, 129,600 units	194,400				206,760
	31	Direct labor	59,730				266,490
	31	Factory overhead	33,594				300,084
	31	Goods finished, 131,400 units			288,960		11,124
	31	Bal. ? units, 4/5 completed					11,124

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 May.	$
4. Cost of units started and completed during May.	$
5. Cost of the ending work in process.	$

Answer 1

Solution a1 & a2:

Baking Department
Computation of Equivalent unit (FIFO)
Particulars	Physical units	Material	Conversion
Units to be accounted for:
Beginning WIP Inventory	7200
Units started this period	129600
Total unit to be accounted for	136800
Units Accounted for:
Units completed and transferred out
From beginning inventory Material - 0% Conversion - 2/3	7200	0	4800
Started and completed currently	124200	124200	124200
Transferred to finished goods	131400	124200	129000
Units in ending WIP Material - 100% Conversion - 4/5	5400	5400	4320
Total units accounted for	136800	129600	133320

Baking Department
Computation of Cost per Equivalent unit
Particulars	Total cost	Material	Conversion
Current period cost	$287,724.00	$194,400.00	$93,324.00
Equivalent units		129600	133320
Cost per equivalent unit		$1.50	$0.70

Solution a3 to a5:

Baking Department
Producton cost report - FIFO
Particulars	Total cost	Material	Conversion
Cost Accounted for :
Cost assigned to unit transferred out:
Cost from beginning WIP Inventory	$12,360
Current cost added to complete beginning WIP:
Material	$0	$0
Conversion (4800 * $0.70)	$3,360		$3,360
Total Cost from beginning inventory	$15,720
Current cost of unit started and completed:
Material (124200*$1.50)	$186,300	$186,300
Conversion (124200*$0.70)	$86,940		$86,940
Total cost of unit started and completed	$273,240
Total cost of unit transferred out	$288,960
Cost assigned to ending WIP:
Material (5400*$1.50)	$8,100	$8,100
Conversion (4320*$0.70)	$3,024		$3,024
Total ending WIP inventory	$11,124
Total cost accounted for	$300,084