Question

Crane Industries Inc. manufactures dorm furniture in separate processes. In each process, materials are entered at the beginning, and conversion costs are incurred uniformly. Production and cost data for the first process in making a product are as follows.

		Cutting Department
Production Data—July		T12-Tables
Work in process units, July 1		0
Units started into production		22,800
Work in process units, July 31		3,420
Work in process percent complete		60
Cost Data—July
Work in process, July 1		$0
Materials		433,200
Labor		267,216
Overhead		118,560
Total		$818,976

Determine the unit costs of production.

		Materials		Conversion Costs		Total Costs
Unit costs-T12 Tables		$		$		$

Answer 1

Solution

	Material	Conversion	Total
Unit costs-T12 Tables	$ 19.00	$ 18.00	$37.00

Working

Statement of Equivalent Units(Weighted average)
				Material		Conversion
	Units			Complete %	Equivalent units	Complete %	Equivalent units
Transferred out	19,380			100%	19,380	100%	19,380
Ending WIP	3,420			100%	3,420	60%	2,052
Total	22,800			Total	22,800	Total	21,432

.

Cost per Equivalent Units (Weighted average)
COST		Material	Conversion	TOTAL
Beginning WIP Inventory Cost (A)		$ 0	$ 0	$ 0
Cost incurred during period (B)		$ 433,200	$ 385,776	$ 818,976
Total Cost to be accounted for (C=A+B)		$ 433,200	$ 385,776	$ 818,976
Total Equivalent Units(D)		22,800	21,432
Cost per Equivalent Units (E=C/D)		$                 19.00	$                   18.00	$                     37.00