Question

Mannassass Company manufactures chairs. The following information was given for the company:

units, beginning work in process 0

units started 20,000

units completed?

units, ending work in process 4,000

cost of direct materials $220,000

cost of conversion $ 27,520

Materials in the ending inventory were 100 percent complete and conversion in the ending inventory was 30 percent complete.

1. Refer to Figure 6-6. What are the units started and completed?

a. 20,000

b. 24,000

c. 16,000

d. 40,000

e. none of the above

        

2. Refer to Figure 6-6. What are the equivalent units for materials and conversion respectively?

a. 20,000; 20,000

b. 20,000; 16,000

c. 20,000; 17,200

d. 16,000; 14,000

e. none of the above

  

                                        

                                             

                                      

3. Refer to Figure 6-6. What are the costs per unit for materials and conversion respectively?

a. $22; $4

b. $28.33; $5.27

c. $11; $1.60

d. $84; $68

e. none of the above

4. Refer to Figure 6-6. What cost is assigned to ending work in process?

a. $45,920

b. $26,000

c. $100,000

d. $114,000

e. none of the above

Figure 6-12

Twinnings Corporation manufactures Scheduling Books. There are two processes: printing and binding. The following information is given for the printing department for September. (The company uses FIFO inventory assumption.)

Units:

units, beginning work in process 40,000 (30% complete for materials, 70% complete for conversion)

started 300,000

completed ?

units, ending work in process 50,000 (35% complete for materials, 90% complete for conversion)

Costs:                                         Materials       Conversion    Total

beginning work in process $ 6,080         $ 2,160             $ 8,240

current costs                                $192,075      $33,770           $225,845

total costs                                    $198,155      $35,930           $234,085

5. Refer to Figure 6-12. What are the FIFO equivalent units for materials?

a. 304,500

b. 294,500

c. 306,500

d. 295,500

e. none of the above

6. Refer to Figure 6-12. What are the FIFO equivalent units for conversion?

a. 306,000

b. 340,000

c. 317,000

d. 307,000

e. none of the above

Answer 1

(1) Units started and completed= Units started - Ending WIP

= 20000-4000= 16000

Option C is correct

(2)

	Material	Conversion
Units completed & started	16000	16000
Ending WIP	(4000*100%) =4000	(4000*30%) =1200
Equivalent units	20000	17200

Option C is correct

(3) Cost pu for material = 220000/20000 = 11

Cost pu for Conversion cost = 27520/17200. = 1.6

Option C is correct

(4) Cost assign to ending WIP

Material = 4000 * 11 = 44000

Conversion cost = 1200*1.6=1920

Total = 44000+1920=45920

Option A is correct

(5) &(6)

	Material	Converion
Beginning WIP	(40000*70%) 28000	(40000*30%) 12000
Units start & complete 300000-50000	250000	250000
Ending Wip	(50000*35%) 17500	(50000*90%) 45000
Equivalent units	295500	307000

Option D is correct for (5)

Option D is correct for (6)