How reconcile the Total Cost of Step 2 of $588,960 to the Total Costs Accounted For of Step 5 (Must Agree With Step 2) of $587,610? There is a variance of $1,350. This is a process costing case for one (1) product.

  

Edward (Ed) Adler 42 43 44 45 BEGINNING WORK IN PROCESS 46 CURRENT PERIOD COSTS D E STEP 2: COSTS TO ACCOUNT FOR Total Materials Labor $86,875 $25,000 $37,500 502,085 $144,200 $216,900 $588,960 $169,200 $254,400 Overhead $24,375 STEP 3: EQUIVALENT UNIT COMPUTATIONS 47 TOTAL COSTS 48 49 50 51 52 53 54 55 BEGINNING WORK IN PROCESS 56 UNITS STARTED AND COMPLETED 57 ENDING WORK IN PROCESS 58 TOTAL UNITS (MUST AGREE WITH STEP 1) 59 TOTAL EQUIVALENT UNITS 60 61 62 63 64 G $86,875 $140,985 MATERIALS COST OF THE CURRENT PERIOD COSTS $165,360 LABOR COST OF THE CURRENT PERIOD COSTS LABOR COST OF THE CURRENT PERIOD COSTS X $502,085 X OVERHEAD APPLICATION RATE OF 65 % OF DIRECT LABOR COST Total Units Equivalent Units Materials Labor Overhead 30,000 30,000 145,000 145,000 21,000 101,500 35,000 35,000 29,000 175,000 210,000 151,500 21,000 MATERIALS: BEGINNING WORK IN PROCESS LABOR: BEGINNING WORK IN PROCESS 101,500 TOTAL UNITS: UNITS COMPLETED MATERIALS: UNITS COMPLETED 29,000 LABOR: UNITS COMPLETED X BEGINNING WORK IN PROCESS CONVERSION OF 70%. ENDING WORK IN PROCESS: UNITS MATERIALS: ENDING WORK IN PROCESS 151,500 LABOR: ENDING WORK IN P:ROCESS TIMES LABOR: ENDING INVENTORY CONVERSION OF 40% + ENDING FINISHED GOODS UNITS Materials $0.81 Labor $1.68 Overhead STEP 4: COSTS PER EQUIVALENT UNIT 65 COST PER EQUIVALENT UNIT (ROUNDED TO NEAREST CENT) 66 67 TOTAL UNIT COST (MATERIALS + LABOR + OVERHEAD) 68 69 70 71 STEP 5: PRODUCTION COST ALLOCATION $1.09 TOTAL MATERIAL COSTS/TOTAL MATERIAL UNITS = $169,200/210,000 TOTAL LABOR COSTS/TOTAL LABOR UNITS = $254,400 / 151,500 $3.58 TOTAL OVERHEAD COSTS/TOTAL OVERHEAD UNITS = $165,360/151,000 72 BEGINNING WORK IN PROCESS 73 UNITS STARTED AND COMPLETED 74 TOTAL COST OF GOODS COMPLETED THIS PERIOD 75 ENDING WORK IN PROCESS: MATERIALS 76 77 LABOR 78 OVERHEAD 79 TOTAL ENDING WORK IN PROCESS 80 81 TOTAL COSTS ACCOUNTED FOR (MUST AGREE WITH STEP 2) $86,875 COSTS TO ACCOUNT FOR: BEGINNING WORK IN PROCESS: MATERIALS/LABOR/OVERHEAD 361,100 COSTS TO ACCOUNT FOR: CURRENT PERIOD COSTS: MATERIALS & LABOR $447,975 $59,285 ENDING FINISHED GOODS 48,697 ENDING WORK IN PROCESS: OF LABOR EQUIVALENT UNITS X $31,653 ENDING WORK IN PROCESS: X COST PER EQUIVALENT UNIT FOR LABOR $139,635 $587,610 VARIANCE OF $1,350