Question

The Sanding Department of Quik Furniture Company has the following production and manufacturing cost data for March 2017, the first month of operation.
Production:

10,000 units started which is comprised of 7,000 units finished and transferred out and 3,000 units started that are 100% complete as to materials and 20% complete as to conversion costs.

Manufacturing costs:
Materials $33,000
Labor $21,000
Overhead $36,000

Required:
Prepare a production cost report.

Answer 1

Answer:

Quick Furniture Company

The Sanding Department

Production Report

For the month of March 2017:

Production Cost Report:

                                          Materials     Conversion     Total

Manufacturing costs          $33,000     $57,000       $90,000

Cost per equivalent unit:

Manufacturing costs          $33,000     $57,000

Equivalent units                    10,000          7,600

Cost per equivalent unit      $3.30         $7.50

Cost assigned to:

Units transferred out          $23,100      $52,500         $75,600

Ending Work in Process      $9,900        $4,500             14,400

Total costs assigned         $33,000      $57,000         $90,000

Explanation:

a) Data and Calculations:

                                          Materials     Conversion

Units started       10,000

Units completed  7,000     7,000           7,000

Ending WIP          3,000     3,000              600

Equivalent units                10,000           7,600

Production Cost Report:

                                          Materials     Conversion     Total

Manufacturing costs          $33,000     $57,000        $90,000

Cost per equivalent unit:

Manufacturing costs          $33,000     $57,000

Equivalent units                    10,000          7,600

Cost per equivalent unit      $3.30         $7.50

Cost assigned to:

Units transferred out          $23,100      $52,500         $75,600

                                 ($3.30 * 7,000)    ($7.50 * 7,000)

Ending Work in Process      $9,900        $4,500             14,400

                                 ($3.30 * 3,000)    ($7.50 * 600)

Total costs assigned         $33,000     $57,000          $90,000