Question

Cost of Production Report: No Beginning Inventories
Howell Paving Company manufactures asphalt paving materials for highway construction through a one-step process in which all materials are added at the beginning of the process. During April 2017, the company accumulated the following data in its process costing system:

Production data
Work-in-process, 4/1/17		0 tons
Raw materials transferred to processing		25,000 tons
Work-in-process, 4/30/17 (75% converted)		5,000 tons
Cost data
Raw materials transferred to processing		$812,500
Conversion costs
Direct labor cost incurred		$59,375
Manufacturing overhead applied		?

Manufacturing overhead is applied at the rate of $6 per equivalent unit (ton) processed.

Prepare a cost of production report for April.

Howell Paving Company
Cost of Production Report
For the Month Ending April 30, 2017
Equivalent units in process:	Materials	Conversion	Total
Units completed
Plus equivalent units in ending inventory
Equivalent units in process
Total cost to accounted for and cost per
equivalent unit in process:
Beginning work-in-process
Current costs
Total cost in process
Equivalent units in process
Cost per equivalent unit in process
Accounting for total costs:
Transferred out
Ending work-in-process:
Materials
Conversion
Total cost accounted for

Answer 1

Howell Paving Company
Cost of Production Report
For the Month Ending April 30, 2017
Equivalent units in process:	Materials	Conversion	Total
Units completed	25,000	25,000
Plus equivalent units in ending inventory	5,000	3,750
Equivalent units in process	30,000	28,750
Total cost to accounted for and cost per
equivalent unit in process:
Beginning work-in-process	$0	$0	$0
Current costs	$812,500	$231,875	$1,044,375
Total cost in process	$812,500	$231,875	$1,044,375
Equivalent units in process	30,000	28,750
Cost per equivalent unit in process	27.08	8.07	35.15
Accounting for total costs:
Transferred out			$878,714
Ending work-in-process:
Materials		$135,417
Conversion		$30,245	$165,661
Total cost accounted for			$1,044,375