Fresh Spark Beverages produces one flavor of a popular local drink. It had no work-in-process on March 31 in its only inventory account. During April, Fresh Spark started 15,000 barrels. Work-in-process on April 30 is 1,500 barrels. The production supervisor estimates that the ending work-in-process inventory is 40% complete. An examination of Fresh Spark's accounting records shows direct material costs of $25,200 and conversion costs of $28,800 for April. All production is sold as it is produced. Required: A. Compute the cost of goods sold for April. B. What is the value of work-in-process inventory on April 30?

Fresh Spark Beverages produces one flavor of a popular local drink. It had no work-in-process on March 31 in its only inventory account. During April, Fresh Spark started 15,000 barrels. Work-in-process on April 30 is 1,500 barrels. The production supervisor estimates that the ending work-in-process inventory is 40% complete. An examination of Fresh Spark's accounting records shows direct material costs of $25,200 and conversion costs of $28,800 for April. All production is sold as it is produced. Required: A. Compute the cost of goods sold for April. B. What is the value of work-in-process inventory on April 30?

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 14E: For each of the following independent situations, calculate the missing values: 1. The Belen plant...

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[The following information applies to the questions displayed below.] Pacific Ink had beginning work-in-process inventory of $750,960 on October 1. Of this amount, $307,920 was the cost of direct materials and $443,040 was the cost of conversion. The 51,000 units in the beginning inventory were 25 percent complete with respect to both direct materials and conversion costs. During October, 108,000 units were transferred out and 33,000 remained in ending inventory. The units in ending inventory were 75 percent complete with respect to direct materials and 35 percent complete with respect to conversion costs. Costs incurred during the period amounted to $2,556,000 for direct materials and $3,278,760 for conversion. Required: a. Compute the equivalent units for the materials and conversion cost calculations. Equivalent units for materials Equivalent units for conversion costs b. Compute the cost per equivalent unit for direct…
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Pacific Ink had beginning work-in-process inventory of $750,960 on October 1. Of this amount, $307,920 was the cost of direct materials and $443,040 was the cost of conversion. The 51,000 units in the beginning inventory were 25 percent complete with respect to both direct materials and conversion costs. During October, 108,000 units were transferred out and 33,000 remained in ending inventory. The units in ending inventory were 75 percent complete with respect to direct materials and 35 percent complete with respect to conversion costs. Costs incurred during the period amounted to $2,556,000 for direct materials and $3,278,760 for conversion. a-1. Compute the cost of goods transferred out and the cost of ending inventory using the FIFO method. Compute the cost of goods transferred out and the cost of ending inventory using the FIFO method. (Do not round intermediate calculations.) Cost of goods transferred out Cost of ending…
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