Question

JJJ Corp. manufactures products for sale to customers. Material is introduced at the beginning of the process. Conversion costs are incurred (and allocated) uniformly throughout the process. Data for the month of February follow:

Work in process, January 31 - 50,000 units
100% complete for direct materials, 40% completed for conversion costs actual costs of direct materials, $70,500; actual costs of conversion, $34,050

Units completed during February, 200,000 Work in process, February 28 - 75,000 units

100% complete for direct materials, 20% completed for conversion costs Direct materials added during February [actual costs] $342,000
Conversion costs added during February [actual costs] $352,950

Required:

1. Calculate the number of units started during the month of February _________

2. Compute the total equivalent units for direct material _________________

3. Compute the total equivalent units for conversion cost ________________

4. Compute the cost per equivalent unit of direct material ________________

5. Compute the cost per equivalent unit of conversion cost _______________

6. Determine the cost of completed production ________________________

7. Determine the cost of the February 28 work in process ___________________

Answer 1

1) Number of units started = 200000+75000-50000 = 225000 unit

2) Equivalent unit of material = 200000+(75000*100%) = 275000 unit

3) Equivalent unit of conversion = 200000+(75000*20%) = 215000 unit

4) Cost per equivalent unit of material = (70500+342000)/275000 = 1.50 per equivalent unit

5) Cost per equivalent unit of conversion = (352950+34050)/215000 = 1.80 per equivalent unit

6) Cost of completed production = (1.5+1.8)*200000 = 660000

7) Cost of ending work in process = (75000*1.5+15000*1.8) = 139500