QUESTION # 1 PROCESS COSTING

During a recent month, a production department in a process manufacturing system completed a number of units of product and transferred them to finished goods. Of these units, 80,000 were in process in the department at the beginning of the month and 315,000 were started and completed during the month. The beginning inventory units were 70% complete with respect to materials and 45% with respect to labour when the month began. At the end of the month, 185,000 additional units were in process in the department and were 20% complete with respect to materials and 35% with respect to labour.

The number of physical units to account for this period is as follows:

Beginning inventory	80,000
Started and Completed	315,000
Ending Inventory	185,000
Total Units To Account For	580,000

Required:

a) Calculate the number of equivalent units with respect to Direct Materials produced in the department during the month

	Units of Product	% Added Materials	Equivalent Units Direct Materials
Beginning Goods In Process
Goods Started and Completed
Ending Goods In Process
Total

b) The production department described above had $530,160 of Direct Materials charged to it during the month. Calculate the Direct Materials Cost Per Equivalent Unit

c) Compute the amount of direct material cost assigned to Work In Process (Ending Inventory) and to those units Finished and Transferred to the next department.

Materials	Equivalent Units	Per Unit Cost	Allocated Cost
Goods Finished and transferred to the next department
Work In Process, Ending Inventory
Total

d) Calculate the number of equivalent units with respect to Labour

	Units of Product	% Added Materials	Equivalent Units Direct Labour
Beginning Goods In Process
Goods Started and Completed
Ending Goods In Process
Total

e) The production department described above had $614,438 of Direct Labour charged to it during the month. Calculate the Direct Labour Cost Per Equivalent Unit

f) Compute the amount of direct labour cost assigned to Work In Process (Ending Inventory) and to those units Finished and Transferred to the next department.

Labour	Equivalent Units	Per Unit Cost	Allocated Cost
Goods Finished and transferred to the next department
Work In Process, Ending Inventory
Total