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Exercise 3-19 Work in Process—Painting Warning Don\'t show me this message again

ID: 2419411 • Letter: E

Question

Exercise 3-19

Work in Process—Painting


  

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Exercise 3-19

The ledger of Hasgrove Company has the following work in process account.

Work in Process—Painting

3/1 Balance 3,420 3/31 Transferred out ? 3/31 Materials 6,260 3/31 Labor 2,740 3/31 Overhead 800 3/31 Balance ?
Production records show that there were 790 units in the beginning inventory, 30% complete, 1,150 units started, and 1,390 units transferred out. The units in ending inventory were 40% complete. Materials are entered at the beginning of the painting process. Hasgrove uses the FIFO method to compute equivalent units.


  

Explanation / Answer

Solution.

1.

2.

Material cost per unit = $6,260 / 1,923 = $3.25.

3. Unit conversion cost for march.

Conversion cost = Direct labor + Manufactureing overhead

= (2,740 + 800) / 1,923

= $1.84

4. What is the total cost of units started in February and completed in March

Unit complete of februry in march = 790 x 70% = 553

Material Cost = 553 x $3.25    = 1,797.25

Conversion cost = 553 x $1.84 = 1,017.52

Total Cost                                  = $2,814.77

5.. Total cost of units started and finished in March

Total unit transfer out = 1,390

Material Cost = 1,390 x $3.25    = 4,417.50

Conversion cost = 1,390 x $1.84 = 2,557.60

Total Cost                                  = $6,975.10

5. Total cost of work in process, March 31

Total cost of work in process = 550 x 5.09 = $2,799.50

Work in process, March 31 Units Beginning inventory                 790 Started             1,150 Transferred ou           (1,390) Unit in W.I.P                 550