(a) Prepare a statement of equivalent production to determine the equivalent units for direct materials (From Moulding & Direct Material Added), and conversion costs and the cost per equivalent unit for direct materials and conversion costs.(b) Calculate the:- Total cost of units completed and transferred to the Packaging Department- Cost of the unexpected losses- Cost of ending work-in-process inventory in the Polishing Department All Things Brass produces brass handles for the furniture industry in a four-stage process -Mixing,Moulding, Polishing and Packaging. Costs incurred in the Polishing Department during January aresummarized as follows:WIP - Polishing Process A/C$ 0January 1 Bal.Transfer from Moulding20,0001,310,000Direct Materials Added391,600Direct Labour638,000Manufacturing Overhead307,400Normal losses are estimated to be 2%% of input during the period. Inspection takes place during theprocessing operation, at which point damaged handles are separated from good handles and sold as scrapto local furniture manufacturers at $85 each.At inspection, 2,000 handles were rejected as scrap. These units had reached the following degree ofcompletion:Transfer from Moulding100%Direct material added40%Conversion costs20%Work-in-progress at the end of January was 4,000 handles and had reached the following degree ofcompletion:Transfer from Moulding100%Direct material added80%Conversion costs50%Direct materials added and conversion costs are incurred uniformly throughout the process.

Computation of above requirement are as follows

Answered: Prepare a statement of equivalent…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Concept explainers

Question

(a) Prepare a statement of equivalent production to determine the equivalent units for direct materials (From Moulding & Direct Material Added), and conversion costs and the cost per equivalent unit for direct materials and conversion costs.

(b) Calculate the:

- Total cost of units completed and transferred to the Packaging Department
- Cost of the unexpected losses
- Cost of ending work-in-process inventory in the Polishing Department

All Things Brass produces brass handles for the furniture industry in a four-stage process -Mixing,
Moulding, Polishing and Packaging. Costs incurred in the Polishing Department during January are
summarized as follows:
WIP - Polishing Process A/C
$ 0
January 1 Bal.
Transfer from Moulding
20,000
1,310,000
Direct Materials Added
391,600
Direct Labour
638,000
Manufacturing Overhead
307,400
Normal losses are estimated to be 2%% of input during the period. Inspection takes place during the
processing operation, at which point damaged handles are separated from good handles and sold as scrap
to local furniture manufacturers at $85 each.
At inspection, 2,000 handles were rejected as scrap. These units had reached the following degree of
completion:
Transfer from Moulding
100%
Direct material added
40%
Conversion costs
20%
Work-in-progress at the end of January was 4,000 handles and had reached the following degree of
completion:
Transfer from Moulding
100%
Direct material added
80%
Conversion costs
50%
Direct materials added and conversion costs are incurred uniformly throughout the process.

Expert Solution

Step by step

Solved in 3 steps with 3 images

SEE SOLUTION Check out a sample Q&A here

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.

Similar questions