Shiffon Electronics manufactures music player. Its costing system uses two cost

Question

Shiffon Electronics manufactures music player. Its costing system uses two cost categories, direct materials and conversion costs. Each product must pass through the Assembly Department, the Programming department, and the Testing Department. Direct materials are added at the beginning of the production process. Conversion costs are allocated evenly throughout production. Shiffon Electronics uses weighted-average costing. The following information is available for the month of March 2015 for the Assembly department. Work in process, beginning inventory 300 units Conversion costs (30% complete) Units started during April 800 units Work in process, ending inventory: 100 units Conversion costs (50% complete) The cost details for the month of March are as follows: Work in process, beginning inventory: Direct materials $345,000 Conversion costs $360,000 Direct materials costs added during April $700,000 Conversion costs added during April $1,120,000 6) What are the equivalent units for direct materials and conversion costs, respectively, for March? A) 1,100 units; 1,100 units B) 1,050 units; 1,100 units C) 1,100 units; 1,050 units D) 1000 units; 1050 units 7) What is the conversion cost per equivalent unit in March? A) $1,595.52 B) $1,409.52 C) $1,345.52 D) $1,066.52 8) What amount of direct materials costs is assigned to the ending Work-in-Process account for March? A) $31,363 B) $63,636 C) $75,075 D) $95,000 9) What amount of conversion costs is assigned to the ending Work-in-Process account for April? A) $140,952 B) $95,000 C) $70,476 D) $247,500

Explanation / Answer

Beginning units                        300                      started &completed          1000

Started                                      800                       Ending WIP                         100

Units to be accounted           1100                     Units accounted                1100

Equivalent units                               Material                             conversion cost

Started and completed                   1000                                       1000

Ending WIP                                       100                                           50(50%)

Total equivalent units                      1100                                      1050

Cost

                                                          Material                           conversion cost

Beginning                                     $345,000                                $360,000

Added                                             700,000                                 1,120,000

total cost                                     $1,045,000                             $1,480,000

Cost per unit                            $1045,000/1100                          $1480,000

                                                       $950                                         $1409.52

6) Equivalent units material 1100 units    ; converstion 1050 units

7) cost per unit conversion = $1409.52

8) cost assigne to ending WIP( Materials) = 100 *950 = $95,000

9) ending      CC   = 50 *1409.52 = $70,476

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