Question

In: Accounting

1. The New York Division of MVP Sports Equipment Company manufactures baseball gloves.  Two production departments are...

1.

The New York Division of MVP Sports Equipment Company manufactures baseball
gloves.  Two production departments are used in sequense: the Cutting Department
and the Stitching Department.  In the Cutting Department, direct material, consisting
of imitation leather is placed into production at the beginning of the process.  Direct
labor and manufacturing overhead costs are incurred uniformly throughout the
process.  The material is rolled to make it softer, and is then cut into the pieces
needed to produce baseball gloves.  The predetermined overhead rate is 150% of
direct labor costs.  MPV uses weighed average costing.
We have the following data about production in the Cutting Department:
Goods-in-Process, January 1, 2020 10,000 units
Direct Material-100% Complete $40,000.00
Conversion (Labor & Overhead)- 50% Complete 120,000
     Total cost of Goods in Process, January 1, 2020 $160,000.00
Units added in January 2020: 70,000 units
Costs added in January 2020:
Direct Material $320,000
Direct Labor 723,840
Factory Overhead 1,028,160
    Total costs added in January 2020 $2,072,000
Units in Goods-in-Process, January 31, 2020: 22,000 units
Direct Material-100% Complete
Conversion Costs-20% Complete

a) Anaylze the flow of units:

b) Compute equivalent units:

c)Compute the per units:

d)The value of Goods-inProcess in the cutting Department on 1/31/2020:

e)The value of Goods-In-Process transferred to the Stiching Department is:

Solutions

Expert Solution

Sollution a
Flow Of Production Physical Unit
Work In process Beginning 10000
Add:- Started during current period 70000
To Account For 80000
Good unit completed and transferred out during current period
from Beginning work in process +Started And Completed 58000
work in process Ending 22000
Accounted for 80000
Sollution b
MVP Sports Equipment Company
Equivalent units of production (EUP)-Cutting Department: - Weighted Average method
Detail Physical Units %Material EUP-Material % Conversion EUP- Conversion
Units Transferred Out 58000 100% 58000 100% 58000
units of Ending work in process 22000 100% 22000 20% 4400
Equivalent units of production 80000 62400
Sollution c
Cost per EUP Total Production Cost Direct Material Conversion
Cost of beginning Work in Process $160,000.00 $40,000.00 $120,000.00
Cost Addrd during the period $2,072,000.00 $320,000.00 $1,752,000.00
Total Cost to account for $2,232,000.00 $360,000.00 $1,872,000.00
/Equivalent units of Production $80,000.00 $62,400.00
Cost per Equivalent unit of Production $4.50 $30.00
Sollution d
value of Goods-inProcess in the cutting Department on 1/31/2020 EUP Direct Material Total Production Cost Direct Material EUP
Conversion		 Conversion
d. Ending work in process( 22000 $231,000.00 $99,000.00 4400 $132,000.00
Total Costs accounted for 22000 $231,000.00 $99,000.00 4400 $132,000.00
Sollution e
value of Goods-In-Process transferred to the Stiching Department EUP Direct Material Total Production Cost Direct Material EUP
Conversion		 Conversion
e. Good units completed and transferred out
Good units completed and transferred out 58000 $2,001,000.00 $261,000.00 58000 $1,740,000.00
Total Costs accounted for 58000 $2,001,000.00 $261,000.00 58000 $1,740,000.00

ekkarill92 answered 3 years ago
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