MacLean Handcraft is a manufacturer of picture frames for large retailers. Every picture frame passes through two departments: the assembly department and the finishing department. This problem focuses on the assembly department. The process-coating system at MacLean has a single direct-cost category (direct materials, and a single indirect-cost category (conversion costs). Direct materials are added when assembly department process is 10% complete. Conversion costs are added evenly during the assembly department's process. MacLean uses the weighted-average method of process costing. Consider the following data for the assembly department in April 2017: (Click the icon to view the data.) Read the requirements Production Costs Materials Costs Total costs to account for Next calculate cost per equivalent unit for direct materials and conversion costs. Conversion Direct Materials Costs Divide by Cost per equivalent unit Finally assign total costs to units completed (and transferred out) and to units in ending work in process. Total Direct Conversion Production Costs Materials Costs Completed and transferred out Work in process, ending Total costs accounted for Requirement 2. What issues should a manager focus on when reviewing the equivalent units calculation? Data table Conversion Costs $135 Physical Units Direct (Frames) Materials Work in process, April 1a 75 $1,775 Started during April 2017 550 Completed during April 2017 500 Work in process, April 30" 125 Total costs added during April 2017 7,600 a Degree of completion: direct materials, 100%; conversion costs, 40%. "Degree of completion: direct materials, 100%; conversion costs, 20%. $10 Print Done are MacLean Handcraft is a manufacturer of picture frames for large retailers. Every picture frame passes through two departments: the assembly department and the finishing department. This problem focuses on the assembly department. The process-costing system at MacLean has a single direct-cost category (direct materials) and a single indirect-cost category (conversion costs), Direct materials are added when the assembly department process is 10% complele. Conversion costs ed evenly during the assembly department's process. MacLean uses the weighted-average method of process coating. Consider the following data for the assembly department in April 2017: (Click the icon to view the data.) Read the requirements HREE Requirement 1. Summarize total assembly department costs for April 2017, and assign total costs to units completed (and transferred out) and to units in ending work in process. Begin by calculating the physical units and equivalent units. Physical Units Equivalent Units Direct Conversion Materials Costs Flow of Production Work in process, beginning Started during current period To account for Completed and transferred out during current period Work in process, ending Accounted for Equivalent units work done to date Now summarize the total costs to account for Total Direct Conversion Costs Production Costs Materials MacLean Handcraft is a manufacturer of picture frames for large retailers. Every picture frame passes through two departments: the assembly department and the finishing department. This problem focuses on the assembly department. The process-costing system at MacLean has a single direct-cost category (direct materials) and a single indirect-cost category (conversion costs). Direct materials are added when the assembly department process is 10% complete. Conversion costs are added evenly during the assembly department's process. MacLean uses the weighted average method of process costing. Consider the following data for the assembly department in April 2017: 2 (Click the icon to view the data.) Read the requirements. TUHI UUDIS U DUUUUIILIUI Next calculate cost per equivalent unit for direct materials and conversion costs Direct Conversion Costs Materials Divide by Cost per equivalent unit Finally assign total costs to units completed (and transferred out) and to units in ending work in process. Total Direct Conversion Production Costs Materials Costs Completed and transferred out Work in process, ending Total costs accounted for Requirement 2. What issues should a manager focus on when reviewing the equivalent units calculation? To show better performance, a department supervisor might report a degree of completion resulting in cost per equivalent unit and operating income. In other words, estimates of degree of completion can help managers should ask supervisors specific questions about the process they followed. Top management should always eriphasize This emphasis drives throughout the organization
