QUESTION ONE: COSTING SYSTEMS Part A The following information was extracted from the financial records of Kiwi Craft Ltd, a manufacturer of cardboard boxes. During February, 89 000 units were completed and transferred out Work in process, 1 February 10000 units $10,900 Direct Material $28,950 Conversion Cost Costs incurred during February $112,700 Direct Material 160,200 Conversion Cost * 100% complete as to Direct Material: 35% complete as to Conversion Cost The equivalent units of activity for February were as follows: Direct Material 103 000 Conversion Cost 97 000 Required: Calculate each of the following using the weighted average process costing method (a) Cost of goods completed during February. (4 marks) (b) Cost of the 28 February work-in-process inventory (3 marks) (c) Briefly explain the meaning of equivalent units. Why are equivalent units needed to properly allocate costs between completed production and production in process? (4 marks) Part B Cool Beats incurred $280,000 of manufacturing overhead costs during the year. However, only 240,000 of overhead was applied to production Required: (a) Explain whether the company has over-applied or under-applied its overhead to production Justify your answer with calculations. (2 marks) (b) Explain the primary differences between job costing, process costing and operation costing