P21-1A Kasten Company manufactures bowling balls through two processes: Molding

Question

P21-1A Kasten Company manufactures bowling balls through two processes: Molding and Packaging. In the Molding Department, the urethane, rubber, plastics, and other materials are molded into bowling balls. In the Packaging Department, the balls are placed in cartons and sent to the finished goods warehouse. All materials are entered at the beginning of each process. Labor and manufacturing overhead are incurred uniformly throughout each process. Production and cost data for the Molding Department during June 2012 are presented below. Production Data June Beginning work in process units -0- Units started into production 20,000 Ending work in process units 2,000 Percent complete-ending inventory 60% Cost Data Materials $198,000 Labor 50,400 Overhead 112,800 Total $361,200 Complete the production cost report for the Molding Department for the month of June.

Explanation / Answer

Units Started = 20,000 Units in Ending inventory = 2,000 Units completed = 18,000. Ending units completed = 60% or equalent completed units in ending inventory = 60 % of 2000 = 1,200 Total equalent completed units in the year = 1,200 + 18,000 = 19,200 Material per unit = $ 198,000 / 19,200 = $10.3125 Labor = $ 50,400 / 19,200 = $ 2.625 Overhead = $112,800 / 19,200 = $ 5.875 Total per unit cost = $ 18.8125 Total cost = $ 361,200 Les: Cost of units completed = $ 18.8125 * 18,000 = $ 338,625 Cost of ending Inventory = $ 22,575

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