Summarize total costs to account For, calculate cost per equivalent unit for direct materials and conversion costs, and assign costs to units completed (and transferred out) and to units in ending work-in-process inventory. THE DATA -
Summarize total costs to account For, calculate cost per equivalent unit for direct materials and conversion costs, and assign costs to units completed (and transferred out) and to units in ending work-in-process inventory. THE DATA -
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Summarize total costs to account
for, calculate cost per equivalent
unit for direct materials and
conversion costs, and assign costs
to units completed (and
transferred out) and to units in
ending work-in-process inventory.
THE DATA -
Data table
Beginning work in process (May 1)
Started in May 2020
Completed during May 2020
Physical Units Direct Conversion
Materials
Costs
$493,360
$91,040
(Watches)
80
500
460
120
Ending work in process (May 31)
Total costs added during May 2020
*Degree of completion: direct materials, 80%; conversion costs, 35%.
Degree of completion: direct materials, 60%; conversion costs, 30%.
$3,220,000 $1,392,000
Transcribed Image Text:Begin by summarizing total costs to account for.
Work in process, beginning
Costs added in current period
Total costs to account for
Total
Production Costs
Completed and transferred out
Work in process, ending
Total costs accounted for
450.000 $
Next, calculate cost per equivalent unit for direct materials and conversion costs.
Direct
Materials
Conversion
Costs
$
Direct
Materials
Production Costs
Costs incurred to date
Divide by equivalent units of work done to date
Cost per equivalent unit
Finally, assign total costs to units completed (and transferred out) and to units in ending work-in-process inventory.
Total
$
Direct
Materials
Conversion
Costs
-U, UL
Conversion
Costs
$
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