Apple Inc. Product Manufacturing Analysis - October 2024

Production Process Overview:

• Mixing Process:
  • Direct materials cost: $150,000
  • Direct labor cost: $100,000
  • Overhead costs: $75,000
  • Output: 50,000 units
• Shaping Process:
  • Direct materials cost: $120,000
  • Direct labor cost: $90,000
  • Overhead costs: $60,000
  • Output: 45,000 units
• Finishing Process:
  • Direct materials cost: $100,000
  • Direct labor cost: $75,000
  • Overhead costs: $50,000
  • Output: 40,000 units

Work in Process Inventory Status:

• Mixing Process:
  • 8,000 units, 90% complete with respect to materials and 70% complete with respect to conversion costs.
• Shaping Process:
  • 6,500 units, 80% complete with respect to materials and 60% complete with respect to conversion costs.
• Finishing Process:
  • 5,000 units, 95% complete with respect to materials and 75% complete with respect to conversion costs.

Additional Information:

• FIFO method is used for process costing.
• Selling and administrative expenses for the month amounted to $500,000.
• A markup of 30% on total cost is used to determine the selling price.

Task List:

1. Equivalent Units Computation:
   • Calculate the equivalent units of production for each process.
2. Cost per Equivalent Unit Determination:
   • Determine the cost per equivalent unit for each process.
3. Total Cost of Goods Completed Calculation:
   • Compute the total cost of goods completed and transferred out of each process.
4. Ending Work in Process Inventory Costing:
   • Find the cost of ending work in process inventory for each process.
5. Cost of Goods Manufactured Schedule Preparation:
   • Prepare a cost of goods manufactured schedule for the month.
6. Cost of Goods Sold Calculation:
   • Determine the cost of goods sold for the month.
7. Gross Profit Analysis:
   • Calculate the gross profit for the month.
8. Income Statement Formulation:
   • Prepare an income statement for the month, including selling and administrative expenses.