King Company manufactures Elvis dolls in two departments. Department A is the molding department that makes the body, guitar, sunglasses, clothes, and packaging for dolls. Department B is the assembly department that puts all the pieces together. The King Company uses a constant-flow manufacturing process. When units from department A are completed, they are transferred to department B for further processing. Therefore, the raw materials of department B are the units received from department A. The completed units from department B are then transferred to the finished goods inventory. The following data relate to King Company production for January 20XX:

DEPARTMENT A DEPARTMENT B

Units:

Beginning Units In Process 8.000 10.000

(DM 75%, CC 25%) (DM 90%, CC70%)

Started In Process 60.000

Ending Units In Process 15.000 6.000

(DM 80%, CC 40%) (DM 75%, CC 60)

Costs:

Direct Materials $35.000 $0

Direct Labor $36.150 $35.700

Factory Overhead $50.100 $31.710

Cost of Beginning Units In Process $15.350 $17.800

1. Prepare the Quantity Equation by finding the Units Completed and Transferred for both of the departments.
2. Prepare the Equivalent Production Schedule and account for the Equivalent Unit Cost for both of the departments.
3. Account for the finished goods transferred to finished goods inventory and the goods in process of department B at the end of January 20XX.
4. Prepare the Cost Equation for both the departments.
5. Compute the sale price of an Elvis Doll with a profit of 80% on cost value and 60% on the sale price and specify which one is more advantageous for the business.