27. Prepare the \"Cost of Production Report\" (five steps) in good form for an a

Question

27. Prepare the "Cost of Production Report" (five steps) in good form for an assembly operation for the month of October from the following information. Use the FIFO method. Beginning inventory-500 units, 30% complete as to conversion costs, cost of $2,100 Materials transferred into the department during the month - 2,500 units, costs of $4,500 Ending inventory-350 units, 20% complete as to conversion costs All materials are added at the beginning of the process. Labor costs incurred $6,500 for 250 hours Factory overhead costs incurred $3,100

Explanation / Answer

Flow Of Units Physical Units Transferred in Material Conversion cost Units to be accounted for Beginning work in process inventory 500 Units transferred 2500 Total u nits to be accounted for    3000 Units accounnted for: Transferred out from units of opening WIP 500 Units started and completed this period 2150 Completed and transferred out (b) 2650 Ending work in progress inventory© 350 Total units to be accounted for (f)      3000 Calculation of equivalent units Units in Beginning WIP n 40 40 % of completion of Beginning WIP in last period    100% 30% % of completion of Beginning WIP completed in current period m 0% 70% Equivalents units of Beginning Wip A (n*m) 0 28 Units started and completed B 2150 2150 2150 Units of Ending WIP   350 350 350 % completion 100% 100% 20% Equivalent units in ending WIP E 350 350 70 Total Equivalent units A+B+E 2500 2248 Cost per equivalent units Transferred in- Material Conversion cost Total Cost per equivalent units Cost during the period   $4,500 9600 $14,100 Total equivalent units 2500 2248 Cost per equivalent units   d $1.80 $4.27 $6.07 Cost charged to production Beginning Work in Process, 2100 Cost incurred during the period $14,100 Total cost accounted 16200 Cost allocated Work in Process, Beginning 2100 To complete Inventory in process Beginning (4.27*28) $120 $120 Cost of completed Beginning, Wip $2,220 Started and completed b*d $3,870 $9,181 $13,051 Transferred 0ut $15,271 Work in process Ending c*d $630 $299 $929 Total cost assigned 16200

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