Problem E (54 points) The inventory at May 1 and the costs charged to Work in Pr

Question

Problem E (54 points) The inventory at May 1 and the costs charged to Work in Process-- B during May for Star Company are as follows: Department $ 65,600 78,300 292,400 107.100 8,000 units, 3/4 completed. During May, all direct materials are transterred from Department A, the units in process at May 1 were completed, and of the 43,500 units entering the department, all were completed except 9.000 units which were two-thirds completed. Inventories are costed by the first-in, first-out method. Prepare a cost of production report for May

Explanation / Answer

Statement of Equivalent production Particulars Direct Materials %completion Equivalent mat Conversion %completion Equivalent Conv Total Opening WIP              8,000.00 0%                           -                8,000.00 25.00%              2,000.00 Units started and completed = 43500 - 9000            34,500.00 100%            34,500.00            34,500.00 100.00%            34,500.00 ending WIP              9,000.00 100%              9,000.00              9,000.00 66.67%              6,000.00 Equivalent Units            43,500.00            42,500.00 Current Month Costs            78,300.00         399,500.00           477,800.00 Cost per Equivalent units                       1.80                      9.40 Ending WIP Units              9,000.00              6,000.00 Cost of ending WIP            16,200.00            56,400.00             72,600.00 Units transferred            34,500.00            36,500.00 Cost of units transferred            62,100.00         343,100.00           405,200.00 Coststo Account for: Opening WIP                           -   CostsTransferred in            477,800.00 Total Coststo Account for          477,800.00 CostsAccounted for Costscompleted and Transferred Out          405,200.00 Ending WIP            72,600.00 Total Costsaccounted for          477,800.00

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