Question

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

ACCOUNT Work in Process—Baking Department							ACCOUNT NO.
Date		Item	Debit		Credit		Balance
							Debit		Credit
Mar.	1	Bal., 18,000 units, 1?4 completed					14,760
	31	Direct materials, 336,000 units	252,000				266,760
	31	Direct labor	40,000				306,760
	31	Factory overhead	60,530				367,290
	31	Goods finished, 330,000 units			346,410		20,880
	31	Bal. ? units, 2?5 completed					20,880

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?
Increase

Answer 1

Cost of Production Report-Baking Department
For the Month Ended March 31
Unit Information
Units charged to production:
Inventory in process, March 1			18000
Received from materials storeroom			336000
Total units accounted for by the Baking Department			354000
Units to be assigned costs:
		Equivalent Units
	Whole Units	Direct Materials	Conversion
Inventory in process, March 1	18000	0	13500
Started and completed in March	312000	312000	312000
Transferred to Packing Department in March	330000	312000	325500
Inventory in process, March 31	24000	24000	9600
Total units to be assigned costs	354000	336000	335100
Cost Information
Costs per equivalent unit:
		Direct Materials	Conversion
Total costs for March in Baking Department		252000	100530
Total equivalent units		336000	335100
Cost per equivalent unit		0.75	0.3
Costs charged to production:
	Direct Materials	Conversion	Total
Inventory in process, March 1			14760
Costs incurred in March			352530
Total costs accounted for by the Baking Department			367290
Cost allocated to completed and partially completed units:
Inventory in process, March 1 balance			14760
To complete inventory in process, March 1	0	4050	4050
Cost of completed March 1 work in process			18810
Started and completed in March	234000	93600	327600
Transferred to Packing Department in March			346410
Inventory in process, March 31	18000	2880	20880
Total costs assigned by the Baking Department			367290
1. Direct materials cost per equivalent unit. $0.75
2. Conversion cost per equivalent unit. $0.3
3. Cost of the beginning work in process completed during March. $18810
4. Cost of units started and completed during March. $327600
5. Cost of the ending work in process. $20880
b
Increase