Assign costs (process costing Step 5) (Learning Objective 3)

Tabor Industries produces its product using a single production process. For the month of December, Tabor Industries determined its “cost per equivalent unit” to be as follows:

During the month, Tabor completed and transferred out 410,000 units to finished goods inventory. At month-end, 80,000 partially complete units remained in ending work in process inventory. These partially completed units were equal to 70,000 equivalent units of direct materials and 50,000 equivalent units of conversion costs.

Requirements 1. Determine the total cost that should be assigned to the following:

a. units completed and transferred out

b. units in ending work in process inventory (Hint: Use Exhibit 4-9 as a guide.)
2. What was the total costs accounted for?
3. What was Tabor’s average cost of making one unit of its product?

Transcribed Image Text:

Cost per equivalent unit: Direct Materials $4.10 Conversion Costs $3.25