The following information concerns production in the Baking Department for August. All direct materials are placed in process at the beginning of production.

1. Determine the number of units in work in process inventory at the end of the month.

2. Determine the equivalent units of production for direct materials and conversion costs in August.

Answer

Check Figure: Conversion, 201,800

3. Determine the following:

Direct materials cost per equivalent unit.

B. Conversion cost per equivalent unit.

C. Cost of the beginning work in process completed during August.

D. Cost of units started and completed during August.

E. Cost of the ending work in process.

Answer

Check Figure: 2. Conversion cost per equivalent unit, $0.32

Assuming that the direct materials cost is the same for July and August, did the conversion cost per equivalent unit increase, decrease, or remain the same in August?

ACCOUNT NO ACCOUNT Work in Process-Baking Department Balance Item Debit Credit Debit Credit Date 8,000 314,000 349,500 378,576 21,996 21,996 Aug. B., 5,000 units, completed 31 Direct materials, 204,000 units 306,000 31 Direct labor 31 Factory overhead 31 Goods finished, 196,000 units 31 Bal. units, ys completed 35,500 29,076 356,580