Holiday Company manufactures basketballs and soccer balls. For both products, materials are added at the beginning of the production process and conversion costs are incurred uniformly. Holiday uses the FIFO method to compute equivalent units. Production and cost data for the month of August are shown on the next page.

Instructions

(a) Calculate the following for both the basketballs and the soccer balls.
(1) The equivalent units of production for materials and conversion costs.
(2) The unit costs of production for materials and conversion costs.
(3) The assignment of costs to units transferred out and in process at the end of the accounting period.

(b) Prepare a production cost report for the month of August for the basketballs only.

Transcribed Image Text:

Production Data-Basketballs Work in process units, August 1 Units started into production Work in process units, August 31 Cost Data-Basketballs Units Percent Complete 500 60% 2,000 600 50% Work in process, August 1 $1,125 Direct materials 1,600 Direct labor 1,280 Manufacturing overhead 1,000 Production Data-Soccer Balls Work in process units, August 1 Units started into production Work in process units, August 31 Cost Data-Soccer Balls Work in process, August 1 Direct labor Direct materials Manufacturing overhead Units 200 2,000 150 $ 450 2,800 1,000 1,394