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Luther Processing Company uses a weighted-average process costing system and manufactures a single product—a premium rug...

Luther Processing Company uses a weighted-average process costing system and manufactures a single product—a premium rug shampoo and cleaner. The company has just completed the manufacturing activity for the month of October. A partially completed production cost report for the month of October for the mixing department is shown below.


Calculate equivalent units and complete production cost report.


**********


Equivalent Units


Quantities
Physical Units

Materials

Conversion Costs


Units to be accounted for

 Work in process, October 1 (all materials, 70% conversion costs)
20,000


 Started into production
160,000


Total units
180,000


Units accounted for

 Transferred out
130,000
?
?


 Work in process, October 31 (60% materials, 40% conversion costs)
50,000
?
?


  Total units accounted for
180,000
?
?


Costs
Materials

Conversion Costs

Total


Unit costs

 Costs in October
$240,000

$105,000

$345,000


 Equivalent units
?

?


 Unit costs
$ ?
+
$ ?
=
$ ?


Costs to be accounted for

 Work in process, October 1


$ 30,000


 Started into production


315,000


  Total costs


$345,000


Cost Reconciliation Schedule

Costs accounted for

 Transferred out


$ ?


 Work in process, October 31

  Materials


?


  Conversion costs


?

?


   Total costs


$ ?


Instructions

a. Prepare a schedule that shows how the equivalent units were calculated so that you can complete the “Quantities: Units accounted for” equivalent units section of the production cost report, and calculate October unit costs.

Materials $1.50

b. Complete the “Cost Reconciliation Schedule” part of the production cost report above.

Transferred out $286,000Work in process $59,000 (Weygandt, 12/2017, pp. 161-162) Weygandt, J. J., Kimmel, P. D., Kieso, D. E., Aly, I. M. (2017). Managerial Accounting: Tools for Business Decision-Making, Canadian Edition, 5th Edition. [[VitalSource Bookshelf version]]. Retrieved from vbk://9781119403999 Always check citation for accuracy before use.

Solutions

Expert Solution

ekkarill92 answered 1 year ago
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