Problem 8-65 (Algo) Choosing Between Job Costing and Process Costing (LO 8-7) Franklin Corporation produces a single product. The product is both large and expensive, so few units are produced in any month. The production process requires all material to be brought to the shop floor before any work begins. The material is then processed and assembled and then transferred to finished goods Inventory. Every unit is completely identical in specification and use, and no customization is possible. During March, only three units were started and these were labelled Unit 03-01. Unn 03-02, and Unit 03-03. There was no beginning Inventory of any kind on March 1. Records from the raw material store and employee time records show the following requisitions and direct labor costs Unit 03-01 Unit 03-02 Unit 03-03 Direct Material $ 11,200 10,200 12,200 Direct Labor $ 35,200 25,200 13,200 The difference in the material cost represent the historical cost of material purchased at different times. The difference in labor cost represent the difference in seniority (not skill) of the individual employees Overhead for the month of March totaled $110,400 Duung March Unit 03-01 and 03-02 were completed and transferred to finished goods. Unit 03-03 was still in process on March 31. Required: a. Suppose Franklin uses a job cost system and applies overhead to products based on direct labor cost. What will be the cost of the units transferred to finished goods? What will be the amount in Work-in-Process Ending Inventory? b. Suppose Franklin uses process costing and Unit 03-03 was 30 percent complete with respect to conversion cost (direct labor and overhead cost). Assume that direct materials cost is not traced to individual units. What will be the cost of the units transferred to The difference in the material cost represent the historical cost of material purchased at different times. The difference in labor cost represent the difference in senionty (not skills of the individual employees Overhead for the month of March totaled $110,400. During March, Unit 03-01 and 03-02 were completed and transferred to finished goods, Unt 03-03 was still in process on March 31 Required: o. Suppose Franklin uses a job cost system and applies overhead to products based on direct labor cost. What will be the cost of the units transferred to finished goods? What will be the amount in Work-in-Process Ending Inventory b. Suppose Franklin uses process costing and Unit 03-03 was 30 percent complete with respect to conversion cost (direct labor and overhead cost). Assume that direct matenals cost is not traced to individual units. What will be the cost of the units transferred to finished goods? What will be the amount in Work in Process Ending Inventory c. What system (job costing or process costing) would you recommend for Franklir? Complete this question by entering your answers in the tabs below. Required A Required Required Suppose Franklin uses process costing and Unit 03-03 was 30 percent complete with respect to conversion coat (direct labor and overhead cost). Assume that direct materials cost is not traced to individual units. What will be the cost of the units transferred to finished goods? What will be the amount in Work in Process Ending Inventory? (Do not round intermediate calculations.) Show less Cost of goods transferred out Work in process anding inventory Unit 1 Unit 03-03 10,20 12,200 25,20 13,200 The difference in the material cost represent the historical cost of matertal purchased at different times. The difference in labor cost represent the difference in seniority (not skills of the individual employees. Overhead for the month of March totaled $110,400. During March, Urm 03-01 and 03-02 were completed and transferred to finished goods. Unit 03-03 was still in process on March 31. Required: 6. Suppose Franklin uses a job cost system and applles overhead to products based on direct labor cost What will be the cost of the units transferred to finished goods? What will be the amount in Work-in-Process Ending Inventory? b. Suppose Franklin uses process costing and Unit 03-03 was 30 percent complete with respect to conversion cost direct labor and overhead cost). Assume that direct materials cost is not traced to individual units. What will be the cost of the units transferred to finished goods? What will be the amount in Work in Process Ending Inventory? c. What system (job costing or process costing) would you recommend for Franklin? Complete this question by entering your answers in the tabs below. Required Required B Required What system (job cotting or process costing) would you recommend for Franklin Johosting Process conting