Question

In: Accounting

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

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., 5,400 units, 2/3 completed 9,540
31 Direct materials, 97,200 units 136,080 145,620
31 Direct labor 37,690 183,310
31 Factory overhead 21,206 204,516
31 Goods finished, 98,400 units 196,620 7,896
31 Bal. ? units, 4/5 completed 7,896

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

Cost of Production Report-Baking Department
For the Month Ended March 31
Unit Information
Units charged to production:
Inventory in process, March 1 5400
Received from materials storeroom 97200
Total units accounted for by the Baking Department 102600
Units to be assigned costs:
Equivalent Units
Whole Units Direct Materials Conversion
Inventory in process, March 1 5400 0 1800
Started and completed in March 93000 93000 93000
Transferred to Packing Department in March 98400 93000 94800
Inventory in process, March 31 4200 4200 3360
Total units to be assigned costs 102600 97200 98160
Cost Information
Costs per equivalent unit:
Direct Materials Conversion
Total costs for March in Baking Department 136080 58896
Total equivalent units 97200 98160
Cost per equivalent unit 1.4 0.6
Costs charged to production:
Direct Materials Conversion Total
Inventory in process, March 1 9540
Costs incurred in March 194976
Total costs accounted for by the Baking Department 204516
Cost allocated to completed and partially completed units:
Inventory in process, March 1 balance 9540
To complete inventory in process, March 1 0 1080 1080
Cost of completed March 1 work in process 10620
Started and completed in March 130200 55800 186000
Transferred to Packing Department in March 196620
Inventory in process, March 31 5880 2016 7896
Total costs assigned by the Baking Department 204516
a
1. Direct materials cost per equivalent unit = $1.4
2. Conversion cost per equivalent unit = $0.6
3. Cost of the beginning work in process completed during March=$10620
4. Cost of units started and completed during March = 186000
5. Cost of the ending work in process = $7896
2
Conversion cost per equivalent unit increase by $0.05

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