Question

Department G had 2,400 units 25% completed at the beginning of the period, 13,300 units were completed during the period; 2,000 units were 20% completed at the end of the period, and the following manufacturing costs debited to the departmental work in process account during the period:

Work in process, beginning of period $32,200
Costs added during period:
Direct materials (12,900 units at $9) 116,100
Direct labor 75,000
Factory overhead 25,000
All direct materials are placed in process at the beginning of production and the first-in, first-out method of inventory costing is used. What is the total cost of the units started and completed during the period (round unit cost calculations to four decimal places and round your final answer to the nearest dollar)?
a. $197,947
b. $181,306
c. $164,665
d. $98,100

Answer 1

The total cost of the units started and completed during the period is $181,306. The right answer is b

Step-by-step explanation:

In order to calculate the total cost of the units started and completed during the period we would have to calculate the Equivalent units as follows:

Equivalent units:

Whole units material conversion

Beginning units 2,400 0 1,800(75%)

Units started and complete 10,900 10,900 10,900

(13,300-2,400)

Total transferred 13,300 10,900 $ 12,700

Ending units 20,00 2,000 400(20%)

Equivalent units 15,300 12,900 13,100

Equivalent cost per unit:

Material conversion

Cost incurred this period $116,100 $100,000

÷ equivalent units ×12,900 ÷13,100

Cost per equivalent unit $9 $7.6336

Therefore, the total cost of the units started and completed during the period =10,900 units×($9+7.6336)

=$181,306