ACCT20053/20076 - Case Study for Workshop 5 - Week 5, Term 3, 2015 Students are required to print this and take it along to your workshop in Week 5. This will be solved within groups during session 3 of your workshop Bigears Telco Ltd assembles various components used in the telecommunication industry. The company's major product, a relay switch, is made by assembling three parts: XY634, AA788, and GU321. The following information relates to activities in April: Beginning work in process inventory: 4000 units (75% completed as to conversion); direct materials $220 000, conversion cost $66 000. Production started: 25 000 units Production completed: 24 000 units Ending work in process inventory: 5000 units (40% completed as to conversion) Direct materials used: XY634, $267 000; AA788, $689 000; GU321, $448 000 Hourly wage of direct labourers, $20; total direct labour payroll, $126 500 Overhead application rate: $60 per direct labour hour All materials parts are introduced at the beginning of Bigears manufacturing process; conversion costs are incurred uniformly throughout the production process. The company uses weighted average method to allocate costs to production. Required: 1. Calculate the total cost of direct material and conversion incurred during April. Calculate equivalent units for direct materials and conversion costs. Show physical units in the first column of your schedule. 2. Determine the cost of goods completed during the month. Determine the cost of the work in process inventory on 30 April. 3. (a) With regard to the units in ending work in process inventory: - How much direct material cost would be added to these units in May? - What percentage of conversion would be performed on these units in May so that they can be completed by the end of May? (b) Assume that the relay switch required the addition of another part (HH887) at the 70% stage of completion. How many equivalent units with respect to part HH887 would be represented in April's ending work in process inventory? (c) ) What is the weighted average method of process costing? How is the