Question

Gannett Handcraft is a manufacturer of picture frames for large retailers. Every picture frame passes through two? departments: the assembly department and the finishing department. This problem focuses on the assembly department. The? process-costing system at Gannett has a single? direct-cost category? (direct materials) and a single? indirect-cost category? (conversion costs). Direct materials are added when the assembly department process is? 10% complete. Conversion costs are added evenly during the assembly? department's process. Gannett uses the? weighted-average method of process costing.

Consider the following data for the assembly department in April 2017?:

	Physical units (frames)	Direct Materials	Conversion costs
work in process April 1 a	95	1665	988
started during April 2017	490
completed during April 2017	455
Work in process April 30b	130
Total costs added during April 2017		17,640	11,856
a. degree of completion: direct materials 100%; conversion costs 40%
b. degree of completion: direct materials 100%; conversion costs, 30%

1.	Summarize total assembly department costs for April 2017 and assign them to units completed? (and transferred? out) and to units in ending work in process.
	Begin by calculating the physical units and equivalent units. Summarize total costs to account for. Next calculate cost per equivalent unit for direct materials and conversion costs. Finally assign total costs to units completed (and transferred out) and to units in ending work in process Please show work and calculations.

Answer 1

Equivalent unit :

	Whole unit	%	EUP-material	%	EUP-conversion
Unit completed and transferred out	455	100%	455	100%	455
Ending work in process	130	100%	130	30%	39
Total equivalent unit	585		585		494

Calculate cost per equivalent unit :

	material	Conversion
Beginning work in process	1665	988
Cost added during period	17640	11856
Total cost	19305	12844
Equivalent unit	585	494
Cost per equivalent unit	33	26

Cost assigned :

	material	Conversion	Total
Cost of units completed and transferred out	455*33 = 15015	455*26 = 11830	26845
Cost of ending work in process	130*33 = 4290	39*26 = 1014	5304