Question

he ledger of Platt Company has the following work in process account: Work in Process—Painting 3/1 Balance $3,010 3/31 Transferred out $? 3/31 Materials 7,040 3/31 Labour 2,200 3/31 Overhead 1,180 3/31 Balance ? Production records show that there were 800 units in the beginning inventory, 30% complete, 1,100 units started, and 1,300 units transferred out. The units in ending inventory were 40% complete. Materials are entered at the beginning of the painting process. Platt uses the FIFO method to calculate equivalent units.

How many units are in process at March 31? Work in process, March 31 units

What is the unit materials cost for March? (Round unit cost to 2 decimal places, e.g. 15.25.) Unit cost $

What is the unit conversion cost for March? (Round unit cost to 2 decimal places, e.g. 15.25.) Unit cost $

Answer 1

Requirement#1

No. Of units are in process at March 31 = 800+1100-1300 =600 units

Requirement #2

FIFO Method			Reconciliation of Units
		% already completed		% completed this period
	Units	Direct Material	Conversion Cost	Direct Material	Conversion
Beginning WIP	800	100%	30%	0%	70%
Units introduced	1100
Total units to be accounted for	1900
Completed and Transferred unit	1300	100%	100%	100%	100%
Ending WIP	600	0%	0%	100%	40%

  

  Statement Of Equivalent units

		...........Material		........Conversion
	Total physical Units	% completed this period	Equivalents Units	% completed this period	Equivalent Units
Beginning Wip	800	0%	0	70%	560
Started and Completed (1300-800)	500	100%	500	100%	500
Ending Work in progress	600	100%	600	40%	240
Total	1900		1100		1300

.

	Requirement #3
	Cost per Equivalent Units
	Direct Material	Conversion cost
Cost incurred in Current Period(a)	$ 7040	$3380 (2200+1180)
Total Equivalent Units(b)	1100	1300
Unit Cost (a/b)	$6.40	$2.60