Question

Reno Co has several processing departments. Costs charged to Department A for January totaled $265,500. WIP 1/1 Materials $13,500, Conversion costs 8000, $21,500 Materials added during the month 75,000, Labor added during the month 104,750, Overhead added during the month 64,250. Records indicated that 3,500 units were in beginning WIP 30% completed as to conversion costs. 17,500 units were started into production, and 4,500 units were in ending WIP 60% complete as to conversion costs. Materials are entered at the beginning of each process.

Determine the EUP (Equivalent Units of Production):
a) 17,500 units
b) 18,750 units
c) 19,500 units
d) 20,250 units

Determine the assignment of costs to goods transferred out and in-process WIP:
a) $265,500
b) $245,500
c) $279,500
d) $288,750

Calculate This month's conversion costs:
a) $104,750
b) $120,250
c) $169,250
d) $224,000

RECAP COSTS:
a) Materials: $21,500, Conversion: $172,000
b) Materials: $21,500, Conversion: $120,250
c) Materials: $94,750, Conversion: $172,000
d) Materials: $94,750, Conversion: $120,250

Account for units – Determine the Physical Flow:
a) 17,500 units completed and transferred out, 4,500 units of ending WIP
b) 18,750 units completed and transferred out, 3,500 units of ending WIP
c) 20,000 units completed and transferred out, 2,500 units of ending WIP
d) 19,500 units completed and transferred out, 3,000 units of ending WIP

Calculate Equivalent Units:
a) Materials: 18,750 units, Conversion: 8,500 units
b) Materials: 20,000 units, Conversion: 7,500 units
c) Materials: 19,500 units, Conversion: 8,000 units
d) Materials: 18,000 units, Conversion: 9,000 units

Determine Unit Costs:
a) Dir Materials: $5.30, Conversion Costs: $12.55
b) Dir Materials: $4.50, Conversion Costs: $14.25
c) Dir Materials: $5.70, Conversion Costs: $11.20
d) Dir Materials: $4.20, Conversion Costs: $15.75

Answer 1

1. EUP (Equivalent Units of Production): c) 19,500 units

2. Assignment of costs to goods transferred out and in-process WIP: b) $245,500

3. This month's conversion costs: c) $169,250

4. Recap Costs: c) Materials: $94,750, Conversion: $172,000

5. Account for units – Determine the Physical Flow: d) 19,500 units completed and transferred out, 3,000 units of ending WIP

6. Calculate Equivalent Units: c) Materials: 19,500 units, Conversion: 8,000 units

7. Determine Unit Costs: a) Dir Materials: $5.30, Conversion Costs: $12.55

Step-by-step explanation:

1.Equivalent Units of Production (EUP):The calculation involves considering the work done on both the beginning and ending units in terms of materials and conversion costs. It's determined by adding the units completed and the equivalent units in ending work in process (WIP). In this case, it's option c) 19,500 units.

2.Assignment of Costs:To find the total cost assigned to units completed and in-process, you need to sum up the costs associated with materials, labor, and overhead. The correct option is b) $245,500.

3. Conversion Costs:This month's conversion costs are the sum of direct labor and overhead costs. The accurate figure is c) $169,250.

4. Recap Costs:The recap costs involve the total materials and conversion costs. The correct option is c) Materials: $94,750, Conversion: $172,000.

5. Physical Flow:Determining the physical flow involves identifying the units completed and transferred out and the units in ending WIP. The accurate option is d) 19,500 units completed and transferred out, 3,000 units of ending WIP.

6. Equivalent Units Calculation: Equivalent units are calculated for both materials and conversion costs separately. The correct option is c) Materials: 19,500 units, Conversion: 8,000 units.

7. Unit Costs: Calculating the unit costs involves dividing the total costs by the equivalent units. The accurate option is a) Dir Materials: $5.30, Conversion Costs: $12.55.