3.Samson Winery in Pleasant Valley, N.Y, has two departments: Fermenting and Packaging.DM are added at the beginning of the fermenting process (grapes) and at the end of the packaging process (bottles).Conversion costs are added evenly throughout each process.Data from the month of March for the fermenting department are as follows:

Gallons:

Beginning WIP inventory0 gallon

Started in production9100 gallons

Completed and transferred out to packaging7900gallons

Ending WIP inventory (80% of the way through1200gallons

The fermenting process)

Costs

Beginning WIP inventory$0

Costs added during March:

DM9828

DL3500

MO3588

Total costs added during March$16916

Requirement: Compute the equivalent units of production for DM and for conversion costs.

Ans:

Completed units:units =EUP for direct materials

In process units:units =EUP for direct materials

Total EUP for direct materials=EUP +EUP =EUP

Completed units:units =EUP for conversion costs

In process units:units =EUP for conversion costs

Total EUP for conversion costs=EUP +EUP =EUP

4.Using data from problem 3 above, compute the total costs of the units (gallons)

a) Completed and transferred out to the Packaging Department

b) In the Fermenting Department ending WIP inventory

Cost per EUP for direct materials

=

Total direct materials costs

Equivalent units of production for direct materials

=

$

EUP

=

$per EUP

Cost per EUP for conversion costs

=

Total conversion costs

Equivalent units of production for conversion costs

=

EUP

=

$per EUP

Direct Materials:

Completed

EUP

per EUP

=

In Process

EUP

per EUP

=

Total

Conversion Costs:

Completed

EUP

per EUP

=

In Process

EUP

per EUP

=

Total

a.

Completed and Transferred Out

=

Direct Materials

+

Conversion Costs

=

+

=

b.

Work-in-Process Inventory

=

Direct Materials

+

Conversion Costs

=

+

=