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In: Accounting

Costs per Equivalent Unit The following information concerns production in the Baking Department for March. All...

Costs per Equivalent Unit

The following information concerns production in the Baking Department for March. All direct materials are placed in process at the beginning of production.

ACCOUNT Work in Process—Baking Department ACCOUNT NO.
Date Item Debit Credit Balance
Debit Credit
Mar. 1 Bal., 7,800 units, 2/5 completed 17,160
31 Direct materials, 140,400 units 266,760 283,920
31 Direct labor 72,440 356,360
31 Factory overhead 40,744 397,104
31 Goods finished, 142,200 units 383,784 13,320
31 Bal. ? units, 2/5 completed 13,320

a. Based on the above data, determine each cost listed below. Round "cost per equivalent unit" answers to the nearest cent.

1. Direct materials cost per equivalent unit. $
2. Conversion cost per equivalent unit. $
3. Cost of the beginning work in process completed during March. $
4. Cost of units started and completed during March. $
5. Cost of the ending work in process. $

b. Assuming that the direct materials cost is the same for February and March, did the conversion cost per equivalent unit increase, decrease, or remain the same in March?

Solutions

Expert Solution

Beggining units 7800 Transferred out 1,42,200
Started into production 140400 Ending units 6,000
148200 148200
Equivalent units Material Conversion
Beginning units 7800 7800
Completion in current period 0% 60%
A 0 4680
Units started and completed 134400 134400
Completion 100% 100%
B 134400 134400
Ending Units 6,000 6,000
Completion 100% 40%
C 6000 2400
Total units A+B+C 140400 141480
Cost per equivalent units
Per unit cost Cost Total units Per unit cost
Material cost 266760 140400 1.90
Conversion cost 113184 141480 0.80
Total 379944 2.70
Cost of goods sold Material convertion cost
Beginning work in progress A 14820 2340 17160
Beginning inventory completed
Completion 0% 60%
Per unit cost 1.90 0.80
Units 7800 7800
Total cost   B 0 3744 3744
Units started and completed
Completion 100% 100%
Per unit cost 1.90 0.80
Units 134400 134400
Total cost    C 255360 107520 362880
Total cost A+B+C 270180 111264 383784
Ending work in progress
Completion 100% 40%
Per unit cost 1.90 0.80
Units 6,000 6,000
Total cost     11400 1920 13320
Cost per equivalent unit Material Conversion cost
For current period 1.90 0.80
For beginning inventory 1.9 0.75
increase (decrease) 0.00 0.05

ekkarill92 answered 3 years ago
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