Austin Co. manufactures a product called Aster in a three-process series. All ma

Question

Austin Co. manufactures a product called Aster in a three-process series. All materials are introduced at the beginning of the first process. Austin uses the first-in, first-out method of inventory costing. Unit and cost data for the first process (Department A) for the month of December follow:

Cost of Production Report

Prepare Austin's Department A cost of production report for December. Round cost per equivalent unit to two decimal places and the other answers to the nearest dollar. If an answer is zero, enter “0”.

Units Completion Cost Work in process inventory: December 1 12,000 60% $140,400 December 31 5,000 40% ? Started in December: 14,000 Direct materials cost 106,400 Conversion cost 70,310 Completed in December 21,000 ? Instruction Austin Co. manufactures a product called Aster in a three-process series. All materials are introduced at the beginning of the first process. Austin uses the first-in, first-out method of inventory costing. Unit and cost data for the first process (Department A) for the month of December follow Units Completion Cost Work in process inventory December 1 December 31 Started in December Direct materials cost Conversion cost Completed in December 12,000 5,000 14,000 60% $140,400 40% 106,400 70,310 21,000 Required Prepare Austin's Department A cost of production report for December. Round cost per equivalent unit to two decimal places and the other answers to the nearest dollar. If an answer is zero, enter "O

Explanation / Answer

Austin co.

Austin co.

                                  Cost of Production Report-Dept. A                                    For the month of October 31,                                                                                     Equivalent Units Units                                                            While Direct Conversion Unit material Units charged to production: Inventory in Process, Dec. 1                             12000 Materials Received                                         14000 Total units to be accounted for                        26000 Units to be assigned Costs: Inventory in process Dec. 1 12000 0 4800 (60% complete) Started and Completed                                     9000 9000 9000 Transferred out                                           21000 9000 13800 Ending Inv. in process (40% complete)            5000 5000 2000 Total Units to be assigned Costs                 26000 14000 15800 Direct Conversion Total material Costs                                                           Unit costs:    Total costs for Dec.                                106400 70310    Total equivalent units                               14000 15800    Cost per equivalent unit                         7.6 4.45 Costs charged to Production: Inv. In process Dec. 1                      140400 Cost incurred                                            176710 Total costs accounted for                     317110 Costs allocated to completed And partially completed units: Inv. In process Dec. 1                           140,400 To complete inventory                           0 21360 21360 Started and Completed                     68400 40050 108450 Transferred Out                                   270,210 Inv. In process Dec. 31                       38000 8900 46900 Total costs assigned by Dept. A                                                                           317,110

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