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ACCOUNT Work in Process—Baking Department ACCOUNT NO. Date Item Debit Credit Balance Debit Credit Mar. 1...


ACCOUNT Work in Process—Baking Department ACCOUNT NO.
Date Item Debit Credit Balance
Debit Credit
Mar. 1 Bal., 4,800 units, 2/5 completed 11,232
31 Direct materials, 86,400 units 172,800 184,032
31 Direct labor 50,600 234,632
31 Factory overhead 28,456 263,088
31 Goods finished, 87,600 units 253,944 9,144
31 Bal. ? units, 3/5 completed 9,144


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

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

FIFO method
Beggining units 4800 Transferred out 87,600
Started into production 86400 Ending units 3,600
91200 91200
Equivalent units Material Conversion
Beginning units 4800 4800
Completion in current period 0% 60%
A 0 2880
Units started and completed 82800 82800
Completion 100% 100%
B 82800 82800
Ending Units 3,600 3,600
Completion 100% 60%
C 3600 2160
Total units A+B+C 86400 87840
Cost per equivalent units
Per unit cost Cost Total units Per unit cost
Material cost 172800 86400 2.00
Conversion cost 79056 87840 0.90
Total 251856 2.90
Cost of goods sold Material convertion cost
Beginning work in progress A 11232
Beginning inventory completed
Completion 0% 60%
Per unit cost 2.00 0.90
Units 4800 4800
Total cost   B 0 2592 2592
Units started and completed
Completion 100% 100%
Per unit cost 2.00 0.90
Units 82800 82800
Total cost    C 165600 74520 240120
Total cost A+B+C 165600 77112 253944
Ending work in progress
Completion 100% 60%
Per unit cost 2.00 0.90
Units 3,600 3,600
Total cost     7200 1944 9144
Total cost accounted for 263088

b.

material at beginning = 4800 * 2 = 9600

Total cost - material = Conversion cost

11232-9600 = 1632 for conversion cost

Conversion cost per unit = 1632/4800*40% = 0.85

So conversion cost per equivalent unit increase from .85 to .90

ekkarill92 answered 1 year ago
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