BETTERER Engine Corporation manufactures a single model of gasoline engine used in lawn mowers, portable generators and pumps. The basic engine block is cast from steel and machined in the Casting Department. Then it is transferred to the Assembly Department, where the crank shaft, valves and other component part are added. After assembly, it is transferred to the finishing department where the engine is tested. Data related to February operation are: Quantity data: Casting Assembly Finishing WIP, beg 500 1,000 300 Stage of completion 25% 50% 50% Transferred to next Dep’t 2,700 2,900 2,800 WIP, end 800 800 400 Stage of completion 90% 40% 50% Cost Data: WIP, beg Cost from Preceding Dept P63,150 P42,840 Materials P10,925 40,258 Direct Labor 338 12,426 2,760 FOH 2,839 12,426 4,140 Factory Cost: Materials 146,575 116,480 Direct Labor 16,362 44,408 12,240 FOH 48,461 44,408 18,360 Required: Using Average method compute for the cost of goods sold assuming there was no beginning or ending inventory of finished goods for the month. Using Average method compute for the Equivalent unit for Casting.
BETTERER Engine Corporation manufactures a single model of gasoline engine used in lawn mowers, portable generators and pumps. The basic engine block is cast from steel and machined in the Casting Department. Then it is transferred to the Assembly Department, where the crank shaft, valves and other component part are added. After assembly, it is transferred to the finishing department where the engine is tested. Data related to February operation are:
|
Quantity data: |
Casting |
Assembly |
Finishing |
|
WIP, beg |
500 |
1,000 |
300 |
|
Stage of completion |
25% |
50% |
50% |
|
Transferred to next Dep’t |
2,700 |
2,900 |
2,800 |
|
WIP, end |
800 |
800 |
400 |
|
Stage of completion |
90% |
40% |
50% |
|
Cost Data: |
|
|
|
|
WIP, beg |
|
|
|
|
Cost from Preceding Dept |
|
P63,150 |
P42,840 |
|
Materials |
P10,925 |
40,258 |
|
|
Direct Labor |
338 |
12,426 |
2,760 |
|
FOH |
2,839 |
12,426 |
4,140 |
|
|
|
|
|
|
Materials |
146,575 |
116,480 |
|
|
Direct Labor |
16,362 |
44,408 |
12,240 |
|
FOH |
48,461 |
44,408 |
18,360 |
Required:
Using Average method compute for the cost of goods sold assuming there was no beginning or ending inventory of finished goods for the month.
Using Average method compute for the Equivalent unit for Casting.
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