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Problem 20-4A Weighted average:
Tamar Co. manufactures a single product in two departments: Forming and Assembly. All direct materials are added at the beginning of the forming process. Conversion costs are added evenly throughout each process. During May, the Forming department started 21,600 units, and completed and transferred 22,200 units of product to the Assembly department. The Forming department's 3,000 units of beginning work in process consisted of $19,800 of direct materials and $221,940 of conversion costs. It has 2.400 units (100% complete with respect to direct materials and 80% complete with respect to conversion) in process at month-end. During the month, $496,800 of direct materials costs and $2,165,940 of conversion costs were charged to the Forming department.
Required
1. Prepare the Forming department's process cost summary for May using the weighted-average method.
Check (1) EUP for conversion, 24,120
2. Prepare the
(2) Cost transferred out. 12.664.000
Analysis Component
3. The costing process depends on numerous estimates.
a. Identify two major estimates that determine the cost per equivalent unit.
b. Assume management compensation is based on maintaining low inventory amounts. Is management more likely to overestimate or understimate the percentage complete?
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Chapter 20 Solutions
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- Sub. general Account. Answer. Asap.arrow_forwardOn July 1, 2022, Burrough Company acquired 136,000 of the outstanding shares of Carter Company for $15 per share. This acquisition gave Burrough a 25 percent ownership of Carter and allowed Burrough to significantly influence the investee's decisions. As of July 1, 2022, the investee had assets with a book value of $7 million and liabilities of $456,800. At the time, Carter held equipment appraised at $319,200 more than book value; it was considered to have a seven-year remaining life with no salvage value. Carter also held a copyright with a five-year remaining life on its books that was undervalued by $980,000. Any remaining excess cost was attributable to an indefinite-lived trademark. Depreciation and amortization are computed using the straight-line method. Burrough applies the equity method for its investment in Carter. Carter's policy is to declare and pay a $1 per share cash dividend every April 1 and October 1. Carter's income, earned evenly throughout each year, was $579,000…arrow_forwardGeneral Accountarrow_forward
Financial & Managerial AccountingAccountingISBN:9781337119207Author:Carl Warren, James M. Reeve, Jonathan DuchacPublisher:Cengage Learning