Question

The following information concerns production in the Baking Department for December. 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
Dec.	1	Bal., 6,600 units, 4/5 completed					13,992
	31	Direct materials, 118,800 units	190,080				204,072
	31	Direct labor	53,360				257,432
	31	Factory overhead	30,010				287,442
	31	Goods finished, 120,300 units			276,426		11,016
	31	Bal., ? units, 4/5 completed					11,016

a. Based on the above data, determine each cost listed below. Round "cost per equivalent unit" answers to the nearest cent.

Answer 1

• Requirement [a]

1. Direct materials cost per equivalent unit.	$ 1.60
2. Conversion cost per equivalent unit.	$ 0.70
3. Cost of the beginning work in process completed during July.	$ 14,916
4. Cost of units started and completed during July.	$ 261,510
5. Cost of the ending work in process.	$ 11,016

• Workings

EUP - FIFO Method	Units	% Material	EUP Materials	% Conversion	EUP - Conversion
Units of ENDING WIP	5,100	100.0%	5,100	80.0%	4,080
Units STARTED & COMPLETED	113,700	100%	113,700	100%	113,700
Units of beginning WIP	6,600	0.00%	-	20.00%	1,320
Equivalent Units of Production			118,800		119,100
COST per EUP			Material		Conversion
Cost incurred this period			$       190,080.00		$                    83,370.00
Total Costs		Costs	$       190,080.00	Costs	$                    83,370.00
Equivalent units of production		EUP	118,800	EUP	119,100
Cost per EUP			$             1.60000		$                          0.7000

COST ASSIGNMENT & RECONCILIATION
Cost Transferred out:	EUP	Cost per EUP	Total Cost
Cost of Beginning WIP			$          13,992.00
Cost to complete beginning WIP-
- Direct Materials	-	$                              1.60	$                        -
- Conversion	1,320	$                              0.70	$                924.00
Total cost to complete beginning WIP			$          14,916.00
Cost of Units started & completed this period:	EUP	Cost per EUP	Total Cost
- Direct Materials	113,700	$                              1.60	$       181,920.00
- Conversion	113,700	$                              0.70	$          79,590.00
Total costs started & Completed this period			$       261,510.00
Total cost of work finished this period				$             276,426.00