BOOK NAME: Financial & Managerial Accounting, 19th Edition ISBN10: 1260247937 | ISBN13: 978-1260247930Ch By Jan Williams, Mark Bettner, Joseph Carcello, Susan Haka, ISBN-10 1260247937, ISBN-13 978-1260247930, Edition 19th McGraw-Hill Education

Ex.: 18.2 in Excel. (critical thinking)

Assume that you are the production manager of the Assembly Department at Metal Products, Inc., the process costing and equivalent units example from earlier in this chapter. One of your responsibilities is to determine whether costs are remaining relatively stable from month to month. Assume that the $29,500 associated with the 1,000 units in process on March 1 (see Exhibit 185) is comprised of the following.

Cut materials transferred from the Cutting Department in February . . . . . . . . . . . . . . . $25,000 Direct materials added in the Assembly Department in February . . . . . . . . . . . . . . . . . 0 Conversion added in the Assembly Department in February . . . . . . . . . . . . . . . . . . . . . 4,500 Total cost associated with beginning inventory on March 1 . . . . . . . . . . . . . . . . . . . . . . $29,500

The cost per equivalent unit of input resource used by the Assembly Department in March is as follows (see Exhibit 187). Cut materials transferred from the Cutting Department in March . . . . . . . . . . . . . . . . . $20 Direct materials added in the Assembly Department in March . . . . . . . . . . . . . . . . . . . 4 Conversion added in the Assembly Department in March . . . . . . . . . . . . . . . . . . . . . . . . . 25 Cost per equivalent unit of input resource used in March . . . . . . . . . . . . . . . . . . . . . . . . . $49

Instructions

a. By how much did the cost per equivalent unit of cut material transferred in from the Cutting Department in February differ from the cost per equivalent unit of cut material transferred to the Assembly Department in March? b. By how much did the cost per equivalent unit of conversion for the Assembly Department in February differ from the cost per equivalent unit of conversion for the Assembly Department in March? c. Speculate as to why the cost per equivalent unit of input resource (cut materials and conversion) may have changed from February to March.