Question
The company buys cloth in various colors and then makes the basic shirts in two? departments, Cutting and Sewing. The company uses a process costing
The company buys cloth in various colors and then makes the basic shirts in two? departments, Cutting and Sewing. The company uses a process costing system? (weighted-average method) to determine the production cost of the basic shirts. In the Cutting? Department, direct materials? (cloth) are added at the beginning of the process and conversion costs are added evenly through the process. In the Sewing? Department, no direct materials are added. The only additional? material, thread, is considered an indirect material because it cannot be easily traced to the finished product. Conversion costs are added evenly throughout the process in the Sewing Department. The finished basic shirts are sold to retail stores or are sent to the Custom Design Department for custom screen printing.
The Custom Design Department creates custom shirts by adding screen printing to the basic shirt. The department creates a design based on the? customer's request and then prints the design using up to four colors. Because these shirts have the custom printing? added, which is unique for each? order, the additional cost incurred is determined using job order? costing, with each custom order considered a separate job.
For March 2016?, the Orlando Shirt Company compiled the following data for the Cutting and Sewing? Departments:
For the same time? period, the Orlando Shirt Company compiled the following data for the Custom Design? Department:
- Solve Requirements (1 - 6) in grid format like above --- With calculations shown.
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