Question

In: Accounting

Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington...

Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington manufactures the carts in two assembly departments: Department A and Department B. All three models are processed initially in Department A, where all material is assembled. The X-10 model is then transferred to finished goods. After processing in Department A, the X-20 and X-40 models are transferred to Department B for final assembly, and then transferred to finished goods.

There were no beginning work-in-process inventories on April 1. Data for April are shown in the following table. Ending work in process is 20 percent complete in Department A and 60 percent complete in Department B. Conversion costs are allocated based on the number of equivalent units processed in each department.

Total

X-10

X-20

X-40

Units started

570

330

230

Units completed in Department A

390

260

190

Units completed in Department B

220

150

Materials

$

365,750

$

71,250

$

99,000

$

195,500

Conversion costs:

Department A

$

291,850

Department B

52,250

Total conversion costs

$

344,100

Required:

a. What is the unit cost of each model transferred to finished goods in April?

b. What is the balance of work-in-process inventory on April 30 for Department A? Department B?


Solutions

Expert Solution

  1. Unit cost of each model calculation

Equivalent units Department A = 390 + (570-390) x 20% + 260 + (330-260) x 20% + 190 + (230-190) x20% = 898units

Conversion cost per unit Department A = $291,850 / 898 = $325 per unit

Equivalent units Department B = 220 + (260-220) x 60% + 150 + (190-150) x 60%

= 418 units

Conversion cost per unit Department B = $52,250 / 418 = $125 per unit

Material Cost per unit

= Material cost / units started
X-10 = $71,250 / 570 = $125 per unit
X-20 = $99,000 / 330 = $300 per unit
X-40 = $195,500 / 230 = $850 per unit

Unit Cost of each model

= material cost per unit + each department cost
X-10 = $125+325 = $450 per unit
X-20 = $300+325+125 = $750 per unit
X-40 = $850+325+125 = $1,300 per unit

B. Balance in work in process ending inventory



X-10 = 180 x $125 +180 x 20% x 325 = $34,200
X-20 = 70 x $300 + 70 x 20% x 325 = $25,550
X-40 = 40 x 850 + 40 x 20% x 325 = $36,600

Department A = $96,350


X-20 = 40 x (300+325) + 40 x 60% x 125 = $28,000
X-40 = 40 x (850+325) + 40 x 60% x 125 = $50,000

Department B = $78,000

Thank you

Please give a thumbs up

ekkarill92 answered 2 years ago
Next > < Previous

Related Solutions

Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington...
Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington manufactures the carts in two assembly departments: Department A and Department B. All three models are processed initially in Department A, where all material is assembled. The X-10 model is then transferred to finished goods. After processing in Department A, the X-20 and X-40 models are transferred to Department B for final assembly, and then transferred to finished goods. There were no beginning work-in-process...
Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington...
Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington manufactures the carts in two assembly departments: Department A and Department B. All three models are processed initially in Department A, where all material is assembled. The X-10 model is then transferred to finished goods. After processing in Department A, the X-20 and X-40 models are transferred to Department B for final assembly, and then transferred to finished goods. There were no beginning work-in-process...
Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington...
Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington manufactures the carts in two assembly departments: Department A and Department B. All three models are processed initially in Department A, where all material is assembled. The X-10 model is then transferred to finished goods. After processing in Department A, the X-20 and X-40 models are transferred to Department B for final assembly, and then transferred to finished goods. There were no beginning work-in-process...
Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington...
Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington manufactures the carts in two assembly departments: Department A and Department B. All three models are processed initially in Department A, where all material is assembled. The X-10 model is then transferred to finished goods. After processing in Department A, the X-20 and X-40 models are transferred to Department B for final assembly, and then transferred to finished goods. There were no beginning work-in-process...
Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington...
Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington manufactures the carts in two assembly departments: Department A and Department B. All three models are processed initially in Department A, where all material is assembled. The X-10 model is then transferred to finished goods. After processing in Department A, the X-20 and X-40 models are transferred to Department B for final assembly, and then transferred to finished goods. There were no beginning work-in-process...
Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington...
Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington manufactures the carts in two assembly departments: Department A and Department B. All three models are processed initially in Department A, where all material is assembled. The X-10 model is then transferred to finished goods. After processing in Department A, the X-20 and X-40 models are transferred to Department B for final assembly, and then transferred to finished goods. There were no beginning work-in-process...
Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington...
Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington manufactures the carts in two assembly departments: Department A and Department B. All three models are processed initially in Department A, where all material is assembled. The X-10 model is then transferred to finished goods. After processing in Department A, the X-20 and X-40 models are transferred to Department B for final assembly, and then transferred to finished goods. There were no beginning work-in-process...
MotoMover makes three models of motorized skateboards. At present, all indirect costs are applied to production...
MotoMover makes three models of motorized skateboards. At present, all indirect costs are applied to production using a single predetermined overhead (OH) rate based on direct labour-hours. Management would like you to provide an analysis of the costs of manufacture of the three models that compares the present approach to costing with the ABC approach to costing. Management is not confident that its products are priced appropriately relative to its competitors. The following information has been assembled regarding the activity...
1.   You purchased 10 shares of Resorts, Inc. stock at a price of $40 a share...
1.   You purchased 10 shares of Resorts, Inc. stock at a price of $40 a share exactly one year ago. You have received dividends totaling $2 a share. Today, you sold your shares at a price of $50 a share. What is your total dollar return on this investment?        (a) $10       (b) $12       (c) $50       (d) $80 (e) $120 2.   Big Boy Equipment, Inc. is expected to pay an annual dividend in the amount of...
Question 1 For the dataset: 20, 20, 10, 10, 40, 50, 20, 30, 10, 20, 50,...
Question 1 For the dataset: 20, 20, 10, 10, 40, 50, 20, 30, 10, 20, 50, 60, 20, 30, 50, 20, 30, 40, 30, 30, 30, 50, 40 calculate the max, min, mode, median and mean.(20%) Draw a boxplot with inner and outer fence For the data in part (i), if the value 60 was replaced by 2000, what would you call this value in the dataset? What could be the explanation for such a value? How can you through...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT