Alvis Construction Supply Company has a department that manufactures wood trusses (wood frames used in the construction industry). The following information is for the production of these trusses for the month of February: Work-in-process inventory, February 1 5,000 trusses Direct materials: 100% complete $ 11,480 Conversion: 40% complete $ 16,258 Units started during February 19,000 trusses Units completed during February and transferred out 18,000 trusses Work-in-process inventory, February 29 Direct materials: 100% complete Conversion: 20% complete Costs incurred during February Direct materials $ 60,040 Conversion $ 93,092 Required: Using the FIFO method, calculate the following: 1-a) Costs per equivalent unit. 1-b) Cost of goods completed and transferred out. 1-c) costs remaining in the work-in-process inventory account. 2) Assume that you are the company's controller. The production department's february equivalent unit cost is higher than expected. If the manager of the first department asks you to do him a favor by increasing the ending inventory completion percentage from 20 to 40% to lower the unit costs, how much would unit cost be affected by this request? Round all of the answers to 4 decimal places.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter3: Process Cost Systems

Section: Chapter Questions

Problem 3CMA: Kimbeth Manufacturing uses a process cost system to manufacture dust density sensors for the mining...

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Alvis Construction Supply Company has a department that manufactures wood trusses (wood frames used in the construction industry). The following information is for the production of these trusses for the month of February: Work-in-process inventory, February 1 5,000 trusses Direct materials: 100% complete $ 11,480 Conversion: 40% complete $ 16,258 Units started during February 19,000 trusses Units completed during February and transferred out 18,000 trusses Work-in-process inventory, February 29 Direct materials: 100% complete Conversion: 20% complete Costs incurred during February Direct materials $ 60,040 Conversion $ 93,092 Required: Using the FIFO method, calculate the following: 1-a) Costs per equivalent unit. 1-b) Cost of goods completed and transferred out. 1-c) costs remaining in the work-in-process inventory account. 2) Assume that you are the company's controller. The production department's february equivalent unit cost is higher than expected. If the manager of the first department asks you to do him a favor by increasing the ending inventory completion percentage from 20 to 40% to lower the unit costs, how much would unit cost be affected by this request? Round all of the answers to 4 decimal places.

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