Celltel Ltd. produces cellular phones in large quantities. For simplicity, assume that the company has two departments, Assembly and Testing.

The manufacturing costs in the Assembly Department during February were

There was no beginning inventory of work-in-process. Suppose work on 19,000 phones was begun in the Assembly Department during February, but only 17,000 phones were fully completed and transferred to the Testing Department. All the parts had been made or placed in process, but only half the labour had been completed for each of the phones still in process.
1. Compute the equivalent units and unit costs for February.
2. Compute the costs of units completed and transferred to the Testing Department. Also compute the cost of the ending work-in-process.
3. Prepare summary journal entries for the use of direct materials, direct labour, and factory overhead applied. Also prepare a journal entry for the transfer of goods completed and transferred. Show the postings to the work-in-process account.

Transcribed Image Text:

Direct materials added Conversion costs Direct labour Factory overhead Assembly costs to account for $ 57,000 $50,000 40,000 90,000 $147,000