Answer: Please see in explanation column
Explanation:
Budgeted Conversion Cost $ 180,000
Total Production hours = 1,000 hours
Conversion cost per production hour = 180,000/1,000 = $ 180 per hour
Production time per unit produce = 20 minutes
Conversion cost per unit -- first mins change to hrs
60min = 1 hour
20 min= 20/60=0.33hr
$ 180 x 0.333333 = $ 59.999per unit
Material cost per unit = $ 30 per unit
Total cost per unit production =
Material cost per unit+ conversion cost per unit = 30+ 59.999= $ 89.999per unit
a)Material Required per unit = $30 per unit
Material purchase for 500 units =30 x 500 = $15,000
b)Conversion cost per unit produce = $ 59.999 per unit
number of units for conversion= 600
Conversion Cost applied for 600 units =( 600 x 59.999 = $35,999.4 rounded to $36,000
Total cost of goods complete per unit = $ 89.999 per unit
Number of units completed = 450 units
Total Cost of Goods completed = 450 x 89.999= $ 40,499.55 =$40,500
A) JOURNAL ENTRY For purchase of raw material for 500 units at $30
Accounts title Debit Credit
Raw and In process Inventory 15,000
Accounts Payable 15,000
B)JOURNAL ENTRY For applied conversion cost to in process inventory for 600 units at $59.999
Raw and in process inventory $36,000
Conversion Cost $36,000
C)JOURNAL ENTRY For completing 450 units at a total cost of $89.999
Finished Goods Inventory $ 40,500
Raw and in Process Inventory $ 40,500
