Old Victrola, Inc., produces top-quality stereos and uses process costing. The manufacture of stereos is such that direct materials, labor, and overhead are all added evenly throughout the production process. Due to the smooth production process, only one cost category-manufacturing costs-is used for equivalent unit calculations. Old Victrola had the following cost and production information available for the months of March and April. Direct materials costs Direct labor costs Manufacturing overhead applied Total manufacturing costs Units in beginning work in process Units transferred to finished goods Units in ending work in process $ March 978,460 2,562,260 3,438,640 $ 6,979,360 April $ 1,168,310 3,041,940 3,571,030 $ 7,781,280 7,000 18,500 4,800 4,800 23,000 6,400 Beginning work in process was 30 percent complete in March and 60 percent complete in April. Ending work in process was 60 percent complete in March and 35 percent complete in April. a. For each of the two months, calculate the equivalent units of production. b-1. For each of the two months, calculate the manufacturing cost per equivalent unit. b-2. Based on equivalent units produced, did total manufacturing costs per unit increase or decrease between March and April? c-1. For each of the two months, calculate the direct materials cost per equivalent unit. c-2. Did the direct materials cost per equivalent unit increase or decrease between March and April?
Old Victrola, Inc., produces top-quality stereos and uses process costing. The manufacture of stereos is such that direct materials, labor, and overhead are all added evenly throughout the production process. Due to the smooth production process, only one cost category-manufacturing costs-is used for equivalent unit calculations. Old Victrola had the following cost and production information available for the months of March and April. Direct materials costs Direct labor costs Manufacturing overhead applied Total manufacturing costs Units in beginning work in process Units transferred to finished goods Units in ending work in process $ March 978,460 2,562,260 3,438,640 $ 6,979,360 April $ 1,168,310 3,041,940 3,571,030 $ 7,781,280 7,000 18,500 4,800 4,800 23,000 6,400 Beginning work in process was 30 percent complete in March and 60 percent complete in April. Ending work in process was 60 percent complete in March and 35 percent complete in April. a. For each of the two months, calculate the equivalent units of production. b-1. For each of the two months, calculate the manufacturing cost per equivalent unit. b-2. Based on equivalent units produced, did total manufacturing costs per unit increase or decrease between March and April? c-1. For each of the two months, calculate the direct materials cost per equivalent unit. c-2. Did the direct materials cost per equivalent unit increase or decrease between March and April?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
None
Transcribed Image Text:Old Victrola, Inc., produces top-quality stereos and uses process costing. The manufacture of stereos is such that direct materials,
labor, and overhead are all added evenly throughout the production process. Due to the smooth production process, only one cost
category-manufacturing costs-is used for equivalent unit calculations. Old Victrola had the following cost and production information
available for the months of March and April.
Direct materials costs
Direct labor costs
Manufacturing overhead applied
Total manufacturing costs
Units in beginning work in process
Units transferred to finished goods
Units in ending work in process
$
March
978,460
2,562,260
3,438,640
$ 6,979,360
April
$ 1,168,310
3,041,940
3,571,030
$ 7,781,280
7,000
18,500
4,800
4,800
23,000
6,400
Beginning work in process was 30 percent complete in March and 60 percent complete in April. Ending work in process was 60
percent complete in March and 35 percent complete in April.
a. For each of the two months, calculate the equivalent units of production.
b-1. For each of the two months, calculate the manufacturing cost per equivalent unit.
b-2. Based on equivalent units produced, did total manufacturing costs per unit increase or decrease between March and April?
c-1. For each of the two months, calculate the direct materials cost per equivalent unit.
c-2. Did the direct materials cost per equivalent unit increase or decrease between March and April?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education