Question

Overton Company has gathered the following information.

Units in beginning work in process		21,700
Units started into production		228,300
Units in ending work in process		24,400
Percent complete in ending work in process:
Conversion costs		60	%
Materials		100	%
Costs incurred:
Direct materials		$100,000
Direct labor		$366,352
Overhead		$186,200

Compute equivalent units of production for materials and for conversion costs.

		Materials		Conversion Costs
The equivalent units of production

Determine the unit costs of production. (Round unit costs to 2 decimal places, e.g. 2.25.)

		Materials		Conversion Costs
Unit costs		$		$

Show the assignment of costs to units transferred out and in process.

Transferred out		$
Ending work in process		$

Answer 1

Units in beginning work in process	21700
(+) Units started into production	228300
(-) Units in ending work in process	24400
Units transferred	225600

(a)
	Materials	Conversion
Units transferred	225600	225600
(+) Ending inventory equivalent units [ Ending inventory units * % Completion ]	24400	14640
Equivalent units of production	250000	240240

(b)
	Materials	Conversion
Total cost incurred	100000	552552
(/) Equivalent units of production	250000	240240
Cost per equivalent unit	0.40	2.30

.(c)
	Materials	Conversion	Total
Transferred out [ Units transferred * Cost per equivalent unit ]	90240	518880	609120
ending work in process [ Ending inventory equivalent units * Cost per equivalent unit ]	9760	33672	43432