Question

Rivera Company has several processing departments.

Answer 1

Answer:

Equivalent Units                      Materials       Conversion

                                               664500                 649440

Production Unit Cost for the Assembly Department= $ 2.40 + $ 0.87= $3.27

b)The assignment of costs to goods transferred=$ 2243363.02

The assignment of costs to goods in process $162648

Part C is given below

Explanation:

Rivera Company

Equivalent Units can be calculated by the format given below.

But first we need to find out the completed units which are calculated by subtracting the ending inventory from the units started. 664,500 - 25,100=

639400 units were completed.

Particulars         Units       % of Completion           Equivalent Units

                                         Materials     C.Costs       Materials     C.Costs

Completed

Units                639400       100          100             639400         639400

Ending WIP       25,100       100           40               25100            10040

Total Equivalent units                                             664500        649440

Costs Added in the Department

Materials added     1,596,100

Labor  +Overhead= 225,800 +  337,400 = $563200

Units Costs For the Assembly Department= Costs Added/ Equivalent Units

Materials=  1,596,100/664500= $ 2.40

Conversion= $563200/649440= $ 0.87

Production Unit Cost for the Assembly Department= $ 2.40 + $ 0.87= $3.27

B) The assignment of costs to goods transferred out and in process will also include preceding department costs. So the total costs will be preceding department costs plus costs added in the Assembly department. This is calculated as follows.

                                                 Materials            Conversion

Preceding Department                                      ($127,800-$49,000) given

Costs                                       78800                     78800

Costs Added                         1,596,100                $563200          

Total Costs                            $ 1,674,900                   $ 642,000

The opening and ending balance of the conversion are given from the preceding department. We subtract them to get the conversion costs. ($127,800-$49,000)= $78800

Equivalent Units                      Materials       Conversion

                                               664500                 649440

Unit Costs OF Materials = $ 1,674,900  /   664500  = $2.52

Unit Costs OF Conversion= $ 642,000 /649440= $ 0.99

The assignment of costs to goods transferred=$ 2243363.02

Materials =  639400 *$2.52= 1611288

Conversion= 639400 *0.99=  $ 632075.02

The assignment of costs to goods in process $162648

Materials = 25100 *$2.52= 63252

Conversion= 100400 *0.99=  $ 99396

(c.) The production cost report for the assembly dept.  contains the equivalent units, the costs of the assembly department. the unit cost and production cost of the assembly department which are given below.( as calculated above)

Rivera Company

Production Cost Report

For the Assembly Department

Particulars         Units       % of Completion           Equivalent Units

                                         Materials     C.Costs       Materials     C.Costs

Completed

Units                639400       100          100             639400         639400

Ending WIP       25,100       100           40               25100            10040

Total Equivalent units                                             664500        649440

Costs Added in the Department

Materials added     1,596,100

Labor  +Overhead= 225,800 +  337,400 = $563200

Units Costs For the Assembly Department= Costs Added/ Equivalent Units

Materials=  1,596,100/664500= $ 2.40

Conversion= $563200/649440= $ 0.87

Production Unit Cost for the Assembly Department= $ 2.40 + $ 0.87= $3.27