(a) Materials Conversion Costs Santana Mortgage Company uses a process cost syst
ID: 2610544 • Letter: #
Question
(a)
Materials
Conversion Costs
Santana Mortgage Company uses a process cost system to accumulate costs in its Application Department. When an application is completed, it is forwarded to the Loan Department for final processing. The following processing and cost data pertain to September.1. Applications in process on September 1, 160 2. Applications started in September, 990 3. Completed applications during September, 730 4. Applications still in process at September 30 were 100% complete as to materials (forms) and 60% complete as to conversion costs. Beginning WIP: Direct materials $1,210 Conversion costs 4,420 September costs: Direct materials $4,977 Direct labor 12,280 Overhead 9,716
Materials are the forms used in the application process, and these costs are incurred at the beginning of the process. Conversion costs are incurred uniformly during the process.
Explanation / Answer
Beginning work in process 160 completed & transferred 730 started during the year 990 ending work in process 420 units to be accounted 1150 units accounted for 1,150 Calculation of Equivalent units % mater materials % CC CC Completed & transferred 730 100% 730 100% 730 ending work in process 420 100% 420 60% 252 units accounted for 1,150 1150 982 Materials conversion Equivalents units of service 1,150 982
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.