The Assembly Department of Power MotorsPower Motors began SeptemberSeptember wit
ID: 2532063 • Letter: T
Question
The Assembly Department of
Power MotorsPower Motors
began
SeptemberSeptember
with no work in process inventory. During the month, production that cost
$39,860
(direct materials,
$9,900 ,
and conversion costs,
$29,960 )
was started on
23,000
units.
PowerPower
completed and transferred to the Testing Department a total of
15,000
units. The ending work in process inventory was
37.5%
complete as to direct materials and
80%
complete as to conversion work.
---------
1.
Compute the equivalent units for direct materials and conversion costs.
2.
Compute the cost per equivalent unit.
3.
Assign the costs to units completed and transferred out and ending work in process inventory.
4.
Record the journal entry for the costs transferred out of the Assembly Department to the Testing Department.
5.
Inventorylong dash— Assembly"
1.
Compute the equivalent units for direct materials and conversion costs.
2.
Compute the cost per equivalent unit.
3.
Assign the costs to units completed and transferred out and ending work in process inventory.
4.
Record the journal entry for the costs transferred out of the Assembly Department to the Testing Department.
5.
Post all of the transactions in the "Work in ProcessInventorylong dash— Assembly"
T-account. What is the ending balance?Explanation / Answer
UNITS TO ACCOUNT FOR: Beginning Work in Process units 0 Add: Units Started in Process 23,000 Total Units to account for: 23,000 UNITS TO BE ACCOUNTED FOR: Units started and completed 15,000 Ending Work in Process 8,000 Total Units to be accounted for: 23,000 Equivalent Units: Material Cost Conversion % Completion Units % Completion Units Units started and completed 100% 15,000 100% 15,000 Ending Work in Process 38% 3,000 80% 6,400 Total Equivalent units 18,000 21,400 COST PER EQUIVALENT UNIT: Material Conversion Total cost added during the year 9,900 29,960 Equivalent Units 18,000 21,400 Cost per Equivalent unit 0.55 1.4 TOTAL COST ACCOUNTED FOR: Units started and Transferred out (15000 units) Equivalent unit Cost per EU Total Cost Material 15,000 0.55 8250 Conversion Cost 15,000 1.4 21000 Total Cost of Units completed and transferred out: 29250 Ending Work in process (8000 units) Equivalent unit Cost per EU Total Cost Material 3,000 0.55 1650 Conversison Cost 6,400 1.4 8960 Total cost of Ending Work in process: 10,610 Req 1: Equivalent Units Material 18000 Conversion 21400 Req 2 Cost per Units Material 0.55 Conversion 1.4 Total cost 1.95 Req 3: Cost of Goods completed: $ 29250 Cost of Ending Inventory: $ 10610 Req 4: Journal entry: Work in Process-Testing account Dr. 29250 Work in process- Assembly Account 29250 Req 5: WORK IN PROCESS INVENTORY-ASSEMBLY Balance 0 WIP-Testing 29,250 Raw material Inv. 9,900 Wages and Oh 29,960 Balance 10,610
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