Manufacturing Process Information Dan started a small manufacturing plant that fabricates small drones. The manufacturing process starts with aluminum pellets being put into a molding machine. After the drone's frame is shaped in the mold the frame is cooled and inspected. If the drone passes inspection, the motor and propellers are added at the end and they are transferred to finished goods after inspection. This process is completely automated. Direct material aluminum is added 100 % at the beginning of the process; direct material motors and propellers are added 100% as the last step in the process. Conversion costs are added equally throughout the process. Conversion is 55% complete for the beginning inventory work in process and 45% complete for the ending inventory work in process. At the beginning of the accounting period, Dan estimates that 15,200 drones will be produced. Estimated factory overhead is $3,800. This information is to be used to determine the application rate for overhead. Estimated and actual direct labor costs totaled $1,954.55 Actual factory overhead costs totaled $3,900. Selling and Administrative Expenses totaled $100,000 The following information is available concerning the direct materials. Direct Materials-Aluminum O pellets @ $2.28a pound 4,000 pounds of pellets @ $2.28 a pound 200 pounds of pellets@$2.28 a pound Beginning inventory Purchase of aluminum Ending Inventory One pound of aluminum makes 4 drones Direct Materials-Prope!llers (there are four propellers for each drone) Beginning inventory Purchase of propellers 0 propellers @$0.10 a propeller 60,800 propellers @ $0.10 a propeller Direct Materials-Motor 0 motors @ $1.00 a drone 15,200 motors @$1.00 a drone Beginning inventory motors Purchase of motors The work in process account has the following information Beginning Work in Process contains 0 drones Ending work in process contains 300 drones The finished goods account has the following Information Beginning Finished Goods Ending Finished Goods 0 drones 2,900 drones 12,000 drones were sold at $39.00 each and the tax rate is 35% Part Two Instructions Using a spreadsheet and based on the information provided in the next section, complete the following requirements: Determine the started and completed units by using the following formula: Started-Ending = Completed and Transferred Out - Beginning 2. Prepare an equivalent units schedule. The schedule should follow the format below; you may 1. add additional information if you would like. (Remember that the schedule is for units of drones.) Whole Equivalent Units Units (Actual) Direct Materials- Direct Materials- Conversion Aluminum Costs Motor and Propellers Beginning Start/Completed Completed/Transferred Out Ending XXX XXx XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX Total 3. Calculate the total cost and the cost per equivalent unit for the direct materials aluminum. 4. Calculate the total cost and the cost per equivalent unit for the direct materials motor and propellers. 5. Calculate the predetermined overhead rate. 6. Determine the total conversion cost by using the predetermined rate and the direct labor rate. Then determine the conversion cost per drone. 7. Determine the unit cost per drone. 8. Prepare a Cost of Production report. This report should show all costs transferred into Work-in- Process and the costs transferred to Finished Goods by using the Equivalent Units Schedule. This process uses FIFO costing. 9. Determine the amounts for the following. a) Ending Work-in-Process Inventory in Units AND Dollars b) Ending Finished Goods Inventory in Units AND Dollars c) Cost of Goods Sold d) Over/Under Applied Manufacturing Overhead e) Show and calculate an Income Statement Over or Under applied COGS f) g) Gross Profit h) Net Income 0.Prepare the necessary Journal Entries related to the manufacturing cycle using the chart of account numbers instead of account names when entering the journal entries. A chart of Accounts is shown below. For example: Instead of Debit Raw Materials -Aluminum I would debit account number 12000 $5.000 and credit 10000 $5,000 when purchasing the raw materials aluminum for cash. An example will be provided for each journal entry. Please follow instructions carefully OCIETY Assets Cash 10000 Accounts Receivable 11000 Raw Materials - Aluminum Raw Materials - Propellers 12000 12100 Raw Materials- Motors Work in Process 12150 12200 Factory Overhead Finished Goods 12300 12400 Liabilities 20000 Accounts Payable 21000 Wages Payable Revenues 40000 Sales Expenses 50000 COGS Manufacturing Process Information Dan started a small manufacturing plant that fabricates small drones. The manufacturing process starts with aluminum pellets being put into a molding machine. After the drone's frame is shaped in the mold the frame is cooled and inspected. If the drone passes inspection, the motor and propellers are added at the end and they are transferred to finished goods after inspection. This process is completely automated. Direct material aluminum is added 100 % at the beginning of the process; direct material motors and propellers are added 100% as the last step in the process. Conversion costs are added equally throughout the process. Conversion is 55% complete for the beginning inventory work in process and 45% complete for the ending inventory work in process. At the beginning of the accounting period, Dan estimates that 15,200 drones will be produced. Estimated factory overhead is $3,800. This information is to be used to determine the application rate for overhead. Estimated and actual direct labor costs totaled $1,954.55 Actual factory overhead costs totaled $3,900. Selling and Administrative Expenses totaled $100,000 The following information is available concerning the direct materials. Direct Materials-Aluminum O pellets @ $2.28a pound 4,000 pounds of pellets @ $2.28 a pound 200 pounds of pellets@$2.28 a pound Beginning inventory Purchase of aluminum Ending Inventory One pound of aluminum makes 4 drones Direct Materials-Prope!llers (there are four propellers for each drone) Beginning inventory Purchase of propellers 0 propellers @$0.10 a propeller 60,800 propellers @ $0.10 a propeller Direct Materials-Motor 0 motors @ $1.00 a drone 15,200 motors @$1.00 a drone Beginning inventory motors Purchase of motors The work in process account has the following information Beginning Work in Process contains 0 drones Ending work in process contains 300 drones The finished goods account has the following Information Beginning Finished Goods Ending Finished Goods 0 drones 2,900 drones 12,000 drones were sold at $39.00 each and the tax rate is 35% Part Two Instructions Using a spreadsheet and based on the information provided in the next section, complete the following requirements: Determine the started and completed units by using the following formula: Started-Ending = Completed and Transferred Out - Beginning 2. Prepare an equivalent units schedule. The schedule should follow the format below; you may 1. add additional information if you would like. (Remember that the schedule is for units of drones.) Whole Equivalent Units Units (Actual) Direct Materials- Direct Materials- Conversion Aluminum Costs Motor and Propellers Beginning Start/Completed Completed/Transferred Out Ending XXX XXx XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX Total 3. Calculate the total cost and the cost per equivalent unit for the direct materials aluminum. 4. Calculate the total cost and the cost per equivalent unit for the direct materials motor and propellers. 5. Calculate the predetermined overhead rate. 6. Determine the total conversion cost by using the predetermined rate and the direct labor rate. Then determine the conversion cost per drone. 7. Determine the unit cost per drone. 8. Prepare a Cost of Production report. This report should show all costs transferred into Work-in- Process and the costs transferred to Finished Goods by using the Equivalent Units Schedule. This process uses FIFO costing. 9. Determine the amounts for the following. a) Ending Work-in-Process Inventory in Units AND Dollars b) Ending Finished Goods Inventory in Units AND Dollars c) Cost of Goods Sold d) Over/Under Applied Manufacturing Overhead e) Show and calculate an Income Statement Over or Under applied COGS f) g) Gross Profit h) Net Income 0.Prepare the necessary Journal Entries related to the manufacturing cycle using the chart of account numbers instead of account names when entering the journal entries. A chart of Accounts is shown below. For example: Instead of Debit Raw Materials -Aluminum I would debit account number 12000 $5.000 and credit 10000 $5,000 when purchasing the raw materials aluminum for cash. An example will be provided for each journal entry. Please follow instructions carefully OCIETY Assets Cash 10000 Accounts Receivable 11000 Raw Materials - Aluminum Raw Materials - Propellers 12000 12100 Raw Materials- Motors Work in Process 12150 12200 Factory Overhead Finished Goods 12300 12400 Liabilities 20000 Accounts Payable 21000 Wages Payable Revenues 40000 Sales Expenses 50000 COGS