Question

A company that makes baseball gloves produces them using 2 production departments. When the gloves are produced they first go through the Fabrication Department, which produces the pieces that are later assembled into a glove. After the Fabrication Department completes its work on the glove, the glove goes to the Assembly Department to finish putting the glove together.

The following data is for the Fabrication Department for the month of June:

Units in the beginning work-in-process inventory                               6,000

Units started during the month                                                           71,000

Units completed during the month and transferred out                      65,000

Units in the ending work-in-process inventory                                  12,000

Units in the ending work-in-process inventory are 90% completed in terms of direct materials and 65% completed in terms of conversion costs  

Costs in the beginning work-in-process inventory - $33,000 of direct materials costs and $30,000 of conversion costs

Costs incurred in the month of June - $800,800 of direct materials costs and $916,400 of conversion costs

Please complete the 5 steps of involved in process costing:

Account for all the units

Calculate the number of equivalent units in terms of direct materials and conversion costs

Calculate the amounts spent on direct materials and conversion costs

Calculate the cost per equivalent unit for direct materials and conversion costs

Allocate the total amount spent between the cost of goods completed (transferred out) and the cost assigned to the ending work-in-process inventory.

Answer 1