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Santana Mortgage Company uses a process cost system to accumulate costs in its Application Department. When...

Santana Mortgage Company uses a process cost system to accumulate costs in its Application Department. When an application is completed, it is forwarded to the Loan Department for final processing. The following processing and cost data pertain to September.

1. Applications in process on September 1, 200
2. Applications started in September, 1,000
3. Completed applications during September, 700
4. Applications still in process at September 30 were 100% complete as to materials (forms) and 60% complete as to conversion costs.
Beginning WIP:
    Direct materials $1,200
    Conversion costs 4,860
September costs:
    Direct materials $5,160
    Direct labor 13,100
    Overhead 8,140


Materials are the forms used in the application process, and these costs are incurred at the beginning of the process. Conversion costs are incurred uniformly during the process.

New attempt is in progress. Some of the new entries may impact the last attempt grading.Your answer is incorrect.

Determine the equivalent units of service (production) for materials and conversion costs.

Materials

Conversion Costs
The equivalent units of service (production)

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Incorrect answer iconYour answer is incorrect.

Compute the unit cost. (Round unit costs to 2 decimal places, e.g. 2.25.)

Materials

Conversion Costs
Unit costs

$

$

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Incorrect answer iconYour answer is incorrect.

Prepare a cost reconciliation schedule. (Round unit costs to 2 decimal places, e.g. 2.25 and final answers to 0 decimal places, e.g. 1,225.)

Costs accounted for:

Transferred out

$

Work in process, September 30

   Materials

$

   Conversion costs

Total costs

$

Solutions

Expert Solution

Work in Process, Beginning 200
Add: Units started during September 1000
Less: Units completed and transferred out -700
Work in process, September 30 500
1
Materials Conversion Costs
Units completed and transferred out 700 700
Work in process, September 30 500 300 =500*60%
The equivalent units of service (production) 1200 1000
2
Materials Conversion Costs
Work in process, beginning 1200 4860
Cost added during September 5160 21240
Total costs 6360 26100
Divide by Equivalent units of production 1200 1000
Unit costs 5.30 26.10
3
Costs accounted for:
Transferred out 21980 =700*(5.30+26.10)
Work in process, September 30
   Materials 2650 =500*5.30
   Conversion costs 7830 10480 =300*26.10
Total costs 32460

ekkarill92 answered 1 year ago
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