In March, Kelly Company had the following unit production costs: materials $11 a

Question

In March, Kelly Company had the following unit production costs: materials $11 and conversion costs $9. On March 1, it had zero work in process. During March, Kelly transferred out 26,970 units. As of March 31, 4,940 units that were 30% complete as to conversion costs and 100% complete as to materials were in ending work in process.

(a) Compute the total units to be accounted for.

(b) Compute the equivalent units of production.

Materials

Conversion costs

(c) Prepare a cost reconciliation schedule, including the costs of materials transferred out and the costs of materials in process.

Cost Reconciliation Schedule

Costs accounted for

   Transferred out

   Work in process, March 31

      Materials

      Conversion costs             $   - $

Total costs

Total units

Explanation / Answer

A./

TOTAL UNITS TO BE ACCUNTED FOR

= 26970 - 4940

= 22030

B./

EQUIVELENT UNITS FOR MATERIAL = 26970 * 100% + 4940 * 100%

= 26970 + 4940

= 31910

EQUIVELENT UNITS FOR CONVERSION COST

= 26970 * 100% + 4940 * 30%

= 26970 + 1482

= 28452

3./

COST RECONCILATION SCHEDULE

COST ACCOUNTED FOR TRANSFERD OUT (26970 * $20) $539400 WORK IN PROCESS MARCH 31 MATERIALS (4940 * $11) $54340 CONVERSION COST (1482 * $9) $13338 $67678 TOTAL COST $607078

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