The Sanding Department of Quik Furniture Company has the following production and manufacturing cost data for March 2017, the first month of operation. Production: 6,480 units finished and transferred out; 3,000 units started that are 100% complete as to materials and 20% complete as to conversion costs. Manufacturing costs: Materials $30,052; labor $20,600; overhead $36,536. Prepare a production cost report.

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Business

Oneill

20 May, 10:13

The Sanding Department of Quik Furniture Company has the following production and manufacturing cost data for March 2017, the first month of operation. Production: 6,480 units finished and transferred out; 3,000 units started that are 100% complete as to materials and 20% complete as to conversion costs. Manufacturing costs: Materials $30,052; labor $20,600; overhead $36,536. Prepare a production cost report.

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Reginald Thornton · Answer 1

Opening 0

Started 6480

Transferred - 3000

Closing 3480

We will draw cost table to identify the average cost incurred on complete units and closing cost of closing units.

Cost Table

A B C=A+B D E F=D+E G=C/F

Cost Op. Current Total Cost Complete Closing Equvlnt Cost

element cost cost units WIP Pro. units P. U

Material - 30,052 30,052 3,000 3,480 6,480 4.64

Labour Cost - 20,600 20,600 3,000 696 3,696 5.57

VOH - 36,536 36,536 3,000 696 3,696 9.89

20.1

Cost Account For

Complete 3,000 20.10 60,290

Closing Wip

Material 3,480 4.64 16,139

Labour 696 5.57 3,879

VOH 696 9.89 6,880

26,898

Total Cost 87,188