QualCo manufactures a single product in two departments: Cutting and Assembly. During May, the Cutting department completed a number of units of a product and transferred them to Assembly. Of these transferred units, 37,500 were in process in the Cutting department at the beginning of May and 150,000 were started and completed in May. May’s Cutting department beginning inventory units were 60% complete with respect to materials and 40% complete with respect to conversion. At the end of May, 51,250 additional units were in process in the Cutting department and were 60% complete with respect to materials and 20% complete with respect to conversion. The Cutting department had $505,035 of direct materials and $396,568 of conversion cost charged to it during May. Its beginning inventory included $74,075 of direct materials cost and $28,493 of conversion cost. 1. Compute the number of units transferred to Assembly. 2. Compute the number of equivalent units with respect to both materials used and conversion used in the Cutting department for May using the FIFO method. 3. Compute the direct materials cost and the conversion cost per equivalent unit for the Cutting department. 4. Using the FIFO method, assign the Cutting department’s May costs to the units transferred out and assign costs to its ending work in process inventory.
QualCo manufactures a single product in two departments: Cutting and Assembly. During May, the Cutting
department completed a number of units of a product and transferred them to Assembly. Of these transferred
units, 37,500 were in process in the Cutting department at the beginning of May and 150,000 were
started and completed in May. May’s Cutting department beginning inventory units were 60% complete
with respect to materials and 40% complete with respect to conversion. At the end of May, 51,250 additional
units were in process in the Cutting department and were 60% complete with respect to materials and
20% complete with respect to conversion.
The Cutting department had $505,035 of direct materials and
$396,568 of conversion cost charged to it during May. Its beginning inventory included $74,075 of direct
materials cost and $28,493 of conversion cost.
1. Compute the number of units transferred to Assembly.
2. Compute the number of equivalent units with respect to both materials used and conversion used in the
Cutting department for May using the FIFO method.
3. Compute the direct materials cost and the conversion cost per equivalent unit for the Cutting department.
4. Using the FIFO method, assign the Cutting department’s May costs to the units transferred out and
assign costs to its ending work in process inventory.
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