Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Devereaux Cycles makes three models of scooter: Commuter, Sport, and X-treme. The scooters are produced in four departments: Assembly, Detailing, Customization, and Packaging. All three

Devereaux Cycles makes three models of scooter: Commuter, Sport, and X-treme. The scooters are produced in four departments: Assembly, Detailing, Customization, and Packaging. All three models are started in Assembly, where all materials are assembled. The Commuter is then sent to Packaging, where it is packaged and transferred to finished goods inventory. The Sport is then transferred to Detailing. Once the detailing process is completed, the Sport models are transferred to Packaging and then finished goods. The X-Treme model is assembled and then transferred to Customization, and then Packaging. When packaged, it is transferred to finished goods.

Data for February are shown in the following table. Conversion costs are allocated based on the number of units processed in each department. No work-in-process inventories are maintained in any department.

Total Commuter (1,200 units) Sport (900 units) X-Treme (400 units)
Materials $ 3,712,000 $ 1,454,000 $ 1,364,000 $ 894,000
Conversion costs:
Assembly $ 2,675,000
Detailing 427,500
Customization 558,000
Packaging 367,500
Total conversion costs $ 4,028,000

Required:

b. What is the cost per unit transferred to finished goods inventory for each of the three models in February?

Note: Do not round intermediate calculations. Round your final answers to the nearest whole dollar.

Cost Per Unit
Commuter
Sport
X-Treme

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Advanced Accounting

Authors: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupnik

12th edition

77862228, 978-1259283567, 1259283569, 978-0077862220

More Books

Students also viewed these Accounting questions

Question

Create an operations budget and monitor its effectiveness.

Answered: 1 week ago

Question

Create a cash budget.

Answered: 1 week ago