Question
In: Accounting
. Black Company manufactures gadgets in one department. The following information is available: Work-In-Process Inventory, beginning &n
- . Black Company manufactures gadgets in one department. The following information is available:
Work-In-Process Inventory, beginning 0
Units started 60,000
Units completed and transferred 48,000
Work-In-Process Inventory, end 12,000
Direct materials added $240,000
Direct labor $164,780
Factory overhead $82,000
The units in the ending Work-In-Process Inventory are 0 percent complete with respect to direct materials and 50 percent complete with respect to conversion costs. Direct materials are added at the end of the process. The total cost of units completed and transferred is ________.
A) $90,240
B) $411,360
C) $459,360
D) $488,400
Solutions
Expert Solution
Answer:
Option C: $ 459,360
Calculation:
| Particulars | Output | Material | Conversion cost | ||
| % | Units | % | Units | ||
| Started and completed | 48,000 | 100% | 48,000 | 100% | 48,000 |
| Ending Inventory | 12,000 | 0% | - | 50% | 6,000 |
| Total | 60,000 | 48,000 | 54,000 | ||
| Current period | $ 240,000 | $ 246,780 | |||
| Total | $ 240,000 | $ 246,780 | |||
| Cost per unit | $ 5.00 | $ 4.57 | |||
Note:
| Value of Started and completed | |
| Material (5 * 48000) | $ 240,000.00 |
| Conversion cost (4.57 * 48000) | $ 219,360.00 |
| Total | $ 459,360.00 |
Hence,
Option 'C' is correct and rest all are incorrect.
In case of any doubt, please feel free to comment.
ekkarill92 answered 2 years agoRelated Solutions
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