Question

Cavalier Company has several processing departments. Costs charged to the assembly department for November 2020 totalled $2,229,000 as follows:

Assign costs and prepare production cost report.

Work in process, November 1

Materials

$69,000

Conversion costs

48,150

$ 117,150

Materials added

1,548,000

Labour

225,920

Overhead

337,930

Production records show that 35,000 units were in beginning work in process, 30% complete in terms of conversion costs, 700,000 units were started into production, and 25,000 units were in ending work in process, 40% complete in terms of conversion costs. Materials are entered at the beginning of each process.

Instructions

a. Determine the equivalent units of production and the unit production costs for the assembly department.

b. Determine the assignment of costs to goods transferred out and in process.

Transferred out $2,165,500

Work in process $63,500

c. Prepare a production cost report for the assembly department.

Answer 1

a
	Materials	Conversion Costs
Equivalent units	735000	720000
Cost per unit	2.20	0.85
b
Costs accounted for:
Transferred out		2165500
Work in process, November 30
Materials	55000
Conversion costs	8500	63500
Total costs		2229000
c
CAVALIER COMPANY
Assembly Department
Production Cost Report
For the Month Ended November 30, 2020
		Equivalent Units
	Physical Units	Materials	Conversion Costs
Units to be accounted for
Work in process, November 1	35000
Started into production	700000
Total units	735000
Units accounted for
Transferred out	710000	710000	710000
Work in process, November 30	25000	25000	10000
Total units	735000	735000	720000
		Materials	Conversion Costs	Total
Unit costs:
Total costs		1617000	612000	2229000
Equivalent units		735000	720000
Unit costs		2.20	0.85	3.05
Costs to be accounted for
Work in process, November 1				117150
Started into production				2111850
Total costs				2229000
Cost Reconciliation Schedule
Costs accounted for
Transferred out				2165500	=710000*3.05
Work in process, November 30
Materials			55000		=25000*2.20
Conversion costs			8500	63500	=10000*0.85
Total costs				2229000