The following information concerns production in the Forging Department for Nove
ID: 2516444 • Letter: T
Question
The following information concerns production in the Forging Department for November. All direct materials are placed into the process at the beginning of production, and conversion costs are incurred evenly throughout the process. The beginning inventory consists of $130,500 of direct materials. ACCOUNT Work in Process—Forging Department ACCOUNT NO. Date Item Debit Credit Balance Debit Credit Nov. 1 Bal., 9,000 units, 50% completed 142,200 30 Direct materials, 82,000 units 1,172,600 1,314,800 30 Direct labor 97,270 1,412,070 30 Factory overhead 134,336 ? 1,546,406 30 Goods finished, ? units ? 30 Bal., 7,200 units, 90% completed ? Cost per equivalent units of $14.30 for Direct Materials and $2.70 for Conversion Costs. Based on the above data, determine each of the following amounts. If required, round your interim calculations to two decimal places. Round final answers (a-c) to the nearest dollar. a. Cost of beginning work in process inventory completed in November. $ b. Cost of units transferred to the next department during November. $ c. Cost of ending work in process inventory on November 30. $ d. Costs per equivalent unit of direct materials and conversion included in the November 1 beginning work in process. If required, round your answers to two decimal places. Direct materials cost per equivalent unit $ Conversion cost per equivalent unit
Having trouble finbding the missing Finished Goods Units.
Explanation / Answer
Solution:
Refer above production report
a. Cost of beginning work in process inventory completed in November = $154,350
b. Cost of units transferred to the next department during November = $1,425,950
c. Cost of ending work in process inventory on November 30 = $120,456
d. Cost per equivalent unit in begnning WIP:
Direct material cost per equivalent unit = $130,500 / 9000 = $14.50
Conversion cost per equivalent unit = ($142,200 - $130,500) / (9000*50%) = $2.60 per unit
Forging Department Computation of Equivalent unit (FIFO) Particulars Physical units Material Conversion Units to be accounted for: Beginning WIP Inventory 9000 Units started this period 82000 Total unit to be accounted for 91000 Units Accounted for: Units completed and transferred out From beginning inventoryMaterial - 0%
Conversion - 50% 9000 0 4500 Started and completed currently 74800 74800 74800 Units in ending WIP
Material - 100%
Conversion - 90% 7200 7200 6480 Total units accounted for 91000 82000 85780
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