McKnight Handcraft is a manufacturer of picture frames for large retailers. Every picture frame passes through two departments: the assembly department and the finishing department. This problem focuses on the assembly department. The process-costing system at McKnight has a single direct-cost category (direct materials) and a single indirect-cost category (conversion costs). Direct materials are added when the assembly department process is 10% complete. Conversion costs are added evenly during the assembly department’s process. McKnight uses the weighted-average method of process costing. Consider the following data for the assembly department in April 2014:

Required
1. Summarize the total assembly department costs for April 2014, and assign them to units completed (and transferred out) and to units in ending work in process.
2. What issues should a manager focus on when reviewing the equivalent unit’scalculation?

Transcribed Image Text:

Physical Unit Diret Conversion Frames) Materials Costs Work in process, April 1 Started during April 2014 Completed during April 2014 Work in process, April 30* Total costs added during April 2014 $ 1530 156 60 510 450 120 $17,850 $11,544 "Degree of c om pletion direct materials, 100%, conversion costs, 40%. bDegree of completion: direct materials, 100%, conversion costs, 15%.