Question

The Sanding Department of Kaiden Company has the following production and cost data for November.

Production
1.	Started and completed 9,700 units.
2.	Started 3,100 units that are 80% completed at November 30.

Costs
Beginning work in process		$-0-
Materials		55,680
Labor		121,800
Manufacturing Overhead		48,720

Materials are entered at the beginning of the process. Conversion costs are incurred uniformly during the process. Kaiden Company uses the FIFO method to compute equivalent units.

(a)

Determine the equivalent units of production for materials and conversion costs.

		Equivalent Units
Materials
Conversion costs

(b)

Compute unit costs and show the assignment of manufacturing costs to units transferred out and in work in process. (Round answers to 2 decimal places, e.g. 15.25.)

Material costs		$
Conversion costs		$
Total unit costs		$

Kaiden Company Cost Reconciliation Schedule
Costs accounted for:
Transferred out				$
Work in process, November 30th
Materials		$
Conversion costs
Total costs				$

Answer 1

A. Equivalent units of production

Flow of production	Units	Materials	Conversion
Units in beginning inventory	0	0	0
Units started and completed	9,700	9,700	9,700
Units in Ending inventory	3,100	3,100	2,480(3,100×80%)
Equivalent units	12,800	12,800	12,180

B. Cost per equivalent unit

	Direct materials	Conversion	Total cost
Current period costs	$55,680	$170,520	$226,200
÷ Equivalent units	12,800	12,180
Cost per equivalent unit	$4.35	$14	$18.35

C. Cost reconciliation schedule

Costs accounted for
Transferred out(9,700×$18.35)	$177,995
Work in process, November 30
Materials (3,100×$4.35)	$13,485
Conversion (2,480×$14)	$34,720
Total costs	$226,200