Question

Exercise 16-11 (Part Level Submission)

The Polishing Department of Major Company has the following production and manufacturing cost data for September. Materials are entered at the beginning of the process.

Production: Beginning inventory 1,730 units that are 100% complete as to materials and 30% complete as to conversion costs; units started during the period are 46,900; ending inventory of 7,700 units 10% complete as to conversion costs.

Manufacturing costs: Beginning inventory costs, comprised of $22,100 of materials and $38,332 of conversion costs; materials costs added in Polishing during the month, $220,077; labor and overhead applied in Polishing during the month, $127,100 and $258,240, respectively.

a. Compute the equivalent units of production for materials and conversion costs for the month of September.

The equivalent units of production

Materials:_________

Conversion Costs:_________

B.Compute the unit costs for materials and conversion costs for the month.

Cost per equivalent unit of material :

C.Determine the costs to be assigned to the units transferred out and in process.

Cost of units transferred out:

Answer 1

Since method was not specified, i have used weighted average method, if other method is required, kindly comment.

A.

	Units	% Material	EUP-Material	% Conversion	EUP-Conversion
Units completed and transferred out	40930	100%	40930	100%	40930
Units of ending work in process	7700	100%	7700	10%	770
Total Equivalent units	48630		48630		41700

B.

Cost per Equivalent unit of Production		Direct Material	Conversion
Cost of beginning work in process	$          60,432	$          22,100	$     38,332
Costs incurred this period	$       605,417	$       220,077	$   385,340
Total Costs	$       665,849	$       242,177	$   423,672
Equivalent units of Production		48630	41700
Cost per Equivalent unit of Production		$              4.98	$       10.16

C.

Costs transferred out	EUP	Cost per EUP	Total Cost
Direct Material	40930	$              4.98	$   203,831
Conversion	40930	$            10.16	$   415,849
Total Transferred out			$ 619,680
Cost of Ending Work in Process	EUP	Cost per EUP	Total Cost
Direct Material	7700	$              4.98	$     38,346
Conversion	770	$            10.16	$       7,823
Total Cost of Ending Work in Process			$     46,169