60.a.

CuttingDepartment:
Material

BeginningWIPInventory
Unitsstarted
Unitstoaccountfor

Units
1,300
4,800
6,100

BeginningWIPInventory
Started&completed
EndingWIPInventory
EUP

1,300
3,700
1,100
6,100

260
3,700
440
4,400

Trans.
In

Material

Conversion

900
3,600
0
4,500

360
3,600
560
4,520

325
3,700
220
4,245

CoatingDepartment:
Units
BeginningWIPInventory
Unitsstarted
Unitstoaccountfor

900
5,000
5,900

BeginningWIPInventory
Started&completed
EndingWIPInventory
EUP

900
3,600
1,400
5,900

0
3,600
1,400
5,000

Total
BeginningWIPInventory
Currentcosts
Totalcosttoaccountfor
DividedbyEUP
CostperEUP

Material

$16,065
56,425

$72,490
$13

c.CosttransferredoutofCutting(FIFO):
CostofBI
CosttocompleteBI
Material(260$8)
Conversion(325$5)
S&C(3,700$13)
Totalcostofgoodstransferred
EndingWIP:
DM(440$8)
CC(220$5)
Total

Conversio
n

$35,200

$21,225

4,400
$8

4,245
$5
$16,065

$2,080
1,625
48,100

$3,520
1,100

51,805

$67,870

4,620
$72,490

d.CoatingDepartment:
Total
$13,514
84,120

$97,634
$17.17

Trans.In

Material

Conversion

$67,870

$4,950

$11,300

5,000
$13.57*

4,500
$1.10

4,520
$2.50

*Rounded
e.CostAssignment:
Transferredout
Beginninginventorycost
Costtocomplete:
Material(900$1.10)
Conversion(360$2.50)
UnitsS&C(3,600$17.17)
Totalcosttransferredout
Endinginventory:
Transferredin(1,400$13.57)
Conversion(560$2.50)
Costaccountedfor(offduetorounding)

61.a.

16,000
$192,000
$12.00
$392,000
$24.50

11,000
$44,000
$4.00
$132,000
$12.00

5,000
$15,000
$3.00
$69,000
$13.80

2,000
$12,000
$6.00
$42,000
$21.00

Unitcosts:
Extrusionmaterial
Formmaterial
Trimmaterial
Finishmaterial
Extrusionconversion
Formconversion
Trimconversion
Finishconversion
Totalunitcost
Timesunitsproduced
Totalproductcost

Plastic
Sheets
$12.00

24.50

$36.50
5,000
$182,500

Standard
Model
$12.00
4.00

24.50
12.00

$52.50
6,000

$315,000

Deluxe
Model
$12.00
4.00
3.00

24.50
12.00
13.80

$69.30
3,000

$207,900

Executive
Model
$12.00
4.00
3.00
6.00
24.50
12.00
13.80
21.00
$96.30
2,000
$192,600

b.
Enteringtrimoperation:

b.CuttingDepartment:

CostinBI
Currentcosts
Total
DividedbyEUP
CostperEUP

Unitsproduced
Materialcosts
Unitcost
Conversioncost
Unitcost

Conversion

Extrusion

$13,514
990

900

$18,998

1,400

Form

Trim

$15,404
61,812

$77,216

20,398
$97,614

Finish

2,000Deluxeunits
1,000Deluxeunits
2,000Executiveunits
Totalequivalentunits
DeluxemodelWIPcosts:
Extrusionmaterial
Formmaterial
Trimmaterial(100%)
Extrusionconversion
Formconversion
Trimconversion(60%)
Workinprocesscosts

EQUIVALENTUNITS
Material
Conversion
% Qty.
Qty.

100
100
100

UnitCost
$12.00
4.00
3.00
24.50
12.00
9.00*
$64.50

2,000
1,000
2,000
5,000

%
100
60
100

2,000
600
2,000
4,600

TotalCosts
$12,000
4,000
3,000
24,500
12,000
9,000*
$64,500

*Conversioncost=($30,000+$39,000)
4,600=$15perequivalentunit.
62. a. Components in produced inventory:
DM Logos

StreamersHandles
Plain 60,000
W/logos&streamers418,000418,000418,000
W/logos,streamers,&handles25,00025,00025,000
25,000
W/streamers15,20015,200
W/streamers&handles2,8002,8002,800
W/handles5,000

5,000
Totalcomponents526,000

443,000461,000
32,800
Ending WIP Inventory (all 9,000 units had the direct material):
Plain = 9,000 0.70 = 6,300
With logo = 9,000 0.25 = 2,250
With streamers = 9,000 0.05 = 450

Units
BI
Started
Unitstoaccountfor

W/handles4,350($0.94+$0.54)

15,000
520,000
535,000

UnitsDMLogosStreamersHandles
BI
15,000
S&C 511,000
Completed526,000526,000443,000
461,000
32,800
EI
9,000

9,000
2,250

450
0
Unitsacctd.for535,000

535,000

445,250

461,450

32,800
BIcost $17,285$13,250$4,035
$0
Currentperiod888,274

468,250298,735
119,977
TotalDMcost$905,559$481,500$302,770$119,977
EUP
535,000445,250
461,450
MaterialcostperEUP$0.90

$0.6
8

$0.26

$0.04
Conversion
BI
Startedandcompleted
Completed
EI(95%complete)
Unitsaccountedfor

$0
1,312
$1,312
32,800

Units
15,000
511,000
526,000

EUP
526,000

9,000
535,000

8,550
534,550

Conversioncosts=$5,703+$282,954=$288,657
ConversioncostperEUP=$288,657534,550=$0.54
Totalcosttoaccountfor=$905,559+$288,657=$1,194,216

CostofendingWIPtowels:
Plaintowels
DM(6,300$0.90)$5,670.00
CC(6,3000.95$0.54)3,231.90

$8,901.90
Towelswithlogos
DM[2,250($0.90+$0.68)]$3,555.00
CC(2,2500.95$0.54)1,154.254,709.25
Towelswithstreamers
DM[450($0.90+$0.26)]$522.00
CC(4500.95$0.54)230.85

752.85
TotalcostofendingWIPInventory$14,364.00

b.

Production

Sales

Plain60,00058,000
W/logos&streamers418,000417,500
W/logos,streamers,&handles25,00024,800
W/streamers15,20015,175
W/streamers&handles2,8002,730
W/handles5,0004,350

c.

CostofendingWIPInventory$14,364.00
CostofendingFGInventory5,680.30
Costofgoodssold1,174,171.70
Totalcostaccountedfor$1,194,216.00
d. The conversion cost for all towels should not be the same
amount.Eachof thedifferentaddonscreatesadditionalcosts
forlaborandoverhead.Assuch,Randazzoshouldbedividing
thesecostsintodifferentcostpoolsandassigningthembasedon
alternativebases.Activitybasedcostingwouldbeusefulinthis
company.
Units
Material Conversion
65.
a.
Beginninginventory
10,000
Unitsstarted
180,000
Unitstoaccountfor
190,000
Beginninginventory
completed
Unitsstarted&completed
Unitscompleted
Endinginventory
EUP

10,000

3,000

140,000
150,000
40,000

190,000

140,000

140,000

40,000

180,000

24,000

167,000

b. DonbrowskiCo.
CostofProductionReport
FortheMonthofMay2013
ProductionData:
Units
Material
Beginninginventory
10,000
Unitsstarted
180,000
Unitstoaccountfor
190,000
Beginninginventorycompleted
10,000
0
Unitsstarted&completed
140,000
140,000
Endinginventory
40,000

40,000

EUP
190,000
180,000

Conversion

3,000
140,000
24,000

167,000

CostData(allatstandard):

Ending Inv.

Plain2,000($0.90+$0.54)
W/logos&streamers500($1.84+$0.54)
W/logos,streamers,&handles200($1.88+$0.54)
W/streamers
25($1.16+$0.54)
W/streamers&handles70($1.20+$0.54)
W/handles
650($0.94+$0.54)
TotalcostofendingFGInventory$5,680.30

6,438.00
$1,174,171.70

2,000
500
200
25
70
650

$2,880.00
1,190.00
484.00
42.50
121.80
962.00

58,000($0.90+$0.54)$83,520.00
Plain
W/logos&streamers417,500($1.84+$0.54) 993,650.00
W/logos,streamers,&hand.24,800($1.88+$0.54) 60,016.00
W/streamers15,175($1.16+$0.54)
25,797.50

W/streamers&handles2,730($1.20+$0.54)4,750.20

BI:DM(10,000$5.50)
CC(7,000$12.50)
Currentcosts:
DM(180,000$5.50)
CC(167,000
$12.50)
Totalcosttoaccountfor

Total
$55,000
87,500

Material
$55,000

Conversion
$87,500

990,000
990,000
2,087,500

2,087,500

$3,220,000

$2,175,000

CostAssignment
Transferredout(150,000$18)
Endinginventory:
Material(40,000$5.50)
Conversion(24,000$12.50)
Totalcostsassigned

$1,045,000

$2,700,000
$220,000
300,000

520,000
$3,220,000

c. Totalvariance=TotalactualcostTotalstandardcost=
$3,137,000$3,077,500=$59,500unfavorable
Material:
Currentactualcost
$1,001,000
Standardcost(180,000$5.50)

(990,000)
Directmaterialvariance
$11,000

U
Conversion:
Currentactualcost
$2,136,000

Standardcost(167,000$12.50)
Conversioncostvariance
CostofGoodsSold
DirectMaterialVariance
ConversionCostVariance

(2,087,500)
$48,500U
59,500
11,000
48,500