Cost of Production Report The Cutting Department of Karachi Carpet Company provides the following data for January. Assume that all materials are added at the beginning of the process. Work in process, January 1, 14,400 units, 80% completed $178,560* *Direct materials (14,400 × $8.40) $120,960 Conversion (14,400 × 80% × $5.00) 57,600 $178,560 Materials added during January from Weaving Department, 221,600 units $1,894,680 Direct labor for January 478,066 Factory overhead for January 584,303 Goods finished during January (includes goods in process, January 1), 224,200 units — Work in process, January 31, 11,800 units, 35% completed — a. Prepare a cost of production report for the Cutting Department. If an amount is zero or a blank, enter in "0". For the cost per equivalent unit computations, round your answers to two decimal places. Karachi Carpet Company Cost of Production Report-Cutting Department For the Month Ended January 31 Unit Information Units charged to production: Inventory in process, January 1 fill in the blank ebea14f6a009fa1_1 14,400 Received from Weaving Department fill in the blank ebea14f6a009fa1_2 221,600 Total units accounted for by the Cutting Department fill in the blank ebea14f6a009fa1_3 236,000 Units to be assigned costs: Equivalent Units Whole Units Direct Materials Conversion Inventory in process, January 1 fill in the blank ebea14f6a009fa1_4 14,400 fill in the blank ebea14f6a009fa1_5 0 fill in the blank ebea14f6a009fa1_6 2,880 Started and completed in January fill in the blank ebea14f6a009fa1_7 209,800 fill in the blank ebea14f6a009fa1_8 209,800 fill in the blank ebea14f6a009fa1_9 209,800 Transferred to finished goods in January fill in the blank ebea14f6a009fa1_10 224,200 fill in the blank ebea14f6a009fa1_11 209,800 fill in the blank ebea14f6a009fa1_12 212,680 Inventory in process, January 31 fill in the blank ebea14f6a009fa1_13 11,800 fill in the blank ebea14f6a009fa1_14 11,800 fill in the blank ebea14f6a009fa1_15 4,130 Total units to be assigned cost fill in the blank ebea14f6a009fa1_16 236,000 fill in the blank ebea14f6a009fa1_17 221,600 fill in the blank ebea14f6a009fa1_18 216,810 Cost Information Cost per equivalent unit: Direct Materials Conversion Total costs for January in Cutting Department $fill in the blank ebea14f6a009fa1_19 1,894,680 $fill in the blank ebea14f6a009fa1_20 1,062,369 Total equivalent units fill in the blank ebea14f6a009fa1_21 221,600 fill in the blank ebea14f6a009fa1_22 216,810 Cost per equivalent unit $fill in the blank ebea14f6a009fa1_23 8.55 $fill in the blank ebea14f6a009fa1_24 4.90 Costs assigned to production: Direct Materials Conversion Total Inventory in process, January 1 $fill in the blank ebea14f6a009fa1_25 178,560 Costs incurred in January fill in the blank ebea14f6a009fa1_26 2,957,049 Total costs accounted for by the Cutting Department $fill in the blank ebea14f6a009fa1_27 3,135,609 Costs allocated to completed and partially completed units: Inventory in process, January 1 balance $fill in the blank ebea14f6a009fa1_28 178,560 To complete inventory in process, January 1 $fill in the blank ebea14f6a009fa1_29 0 $fill in the blank ebea14f6a009fa1_30 14,112 fill in the blank ebea14f6a009fa1_31 14,112 Cost of completed January 1 work in process $fill in the blank ebea14f6a009fa1_32 192,672 Started and completed in January fill in the blank ebea14f6a009fa1_33 1,793,790 fill in the blank ebea14f6a009fa1_34 1,028,020 fill in the blank ebea14f6a009fa1_35 2,821,810 Transferred to finished goods in January $fill in the blank ebea14f6a009fa1_36 3,014,482 Inventory in process, January 31 fill in the blank ebea14f6a009fa1_37 100,890 fill in the blank ebea14f6a009fa1_38 20,237 fill in the blank ebea14f6a009fa1_39 121,127 Total costs assigned by the Cutting Department $fill in the blank ebea14f6a009fa1_40 3,135,609 b. Compute and evaluate the change in the costs per equivalent unit for direct materials and conversion from the previous month (December). If required, round your answers to two decimal places. Increase or Decrease Amount Change in direct materials cost per equivalent unit $fill in the blank 0ff3b70effb1fa2_2 Change in conversion cost per equivalent unit $fill in the blank 0ff3b70effb1fa2_4
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Answer B only
Cost of Production Report
The Cutting Department of Karachi Carpet Company provides the following data for January. Assume that all materials are added at the beginning of the process.
Work in process, January 1, 14,400 units, 80% completed $178,560*
*Direct materials (14,400 × $8.40) $120,960
Conversion (14,400 × 80% × $5.00) 57,600
$178,560
Materials added during January from Weaving Department, 221,600 units $1,894,680
Direct labor for January 478,066
Factory overhead for January 584,303
Goods finished during January (includes goods in process, January 1), 224,200 units —
Work in process, January 31, 11,800 units, 35% completed —
a. Prepare a cost of production report for the Cutting Department. If an amount is zero or a blank, enter in "0". For the cost per equivalent unit computations, round your answers to two decimal places.
Karachi Carpet Company
Cost of Production Report-Cutting Department
For the Month Ended January 31
Unit Information
Units charged to production:
Inventory in process, January 1 fill in the blank ebea14f6a009fa1_1
14,400
Received from Weaving Department fill in the blank ebea14f6a009fa1_2
221,600
Total units accounted for by the Cutting Department fill in the blank ebea14f6a009fa1_3
236,000
Units to be assigned costs:
Equivalent Units
Whole Units Direct Materials Conversion
Inventory in process, January 1 fill in the blank ebea14f6a009fa1_4
14,400
fill in the blank ebea14f6a009fa1_5
0
fill in the blank ebea14f6a009fa1_6
2,880
Started and completed in January fill in the blank ebea14f6a009fa1_7
209,800
fill in the blank ebea14f6a009fa1_8
209,800
fill in the blank ebea14f6a009fa1_9
209,800
Transferred to finished goods in January fill in the blank ebea14f6a009fa1_10
224,200
fill in the blank ebea14f6a009fa1_11
209,800
fill in the blank ebea14f6a009fa1_12
212,680
Inventory in process, January 31 fill in the blank ebea14f6a009fa1_13
11,800
fill in the blank ebea14f6a009fa1_14
11,800
fill in the blank ebea14f6a009fa1_15
4,130
Total units to be assigned cost fill in the blank ebea14f6a009fa1_16
236,000
fill in the blank ebea14f6a009fa1_17
221,600
fill in the blank ebea14f6a009fa1_18
216,810
Cost Information
Cost per equivalent unit:
Direct Materials Conversion
Total costs for January in Cutting Department $fill in the blank ebea14f6a009fa1_19
1,894,680
$fill in the blank ebea14f6a009fa1_20
1,062,369
Total equivalent units fill in the blank ebea14f6a009fa1_21
221,600
fill in the blank ebea14f6a009fa1_22
216,810
Cost per equivalent unit $fill in the blank ebea14f6a009fa1_23
8.55
$fill in the blank ebea14f6a009fa1_24
4.90
Costs assigned to production:
Direct Materials Conversion Total
Inventory in process, January 1 $fill in the blank ebea14f6a009fa1_25
178,560
Costs incurred in January fill in the blank ebea14f6a009fa1_26
2,957,049
Total costs accounted for by the Cutting Department $fill in the blank ebea14f6a009fa1_27
3,135,609
Costs allocated to completed and partially completed units:
Inventory in process, January 1 balance $fill in the blank ebea14f6a009fa1_28
178,560
To complete inventory in process, January 1 $fill in the blank ebea14f6a009fa1_29
0
$fill in the blank ebea14f6a009fa1_30
14,112
fill in the blank ebea14f6a009fa1_31
14,112
Cost of completed January 1 work in process $fill in the blank ebea14f6a009fa1_32
192,672
Started and completed in January fill in the blank ebea14f6a009fa1_33
1,793,790
fill in the blank ebea14f6a009fa1_34
1,028,020
fill in the blank ebea14f6a009fa1_35
2,821,810
Transferred to finished goods in January $fill in the blank ebea14f6a009fa1_36
3,014,482
Inventory in process, January 31 fill in the blank ebea14f6a009fa1_37
100,890
fill in the blank ebea14f6a009fa1_38
20,237
fill in the blank ebea14f6a009fa1_39
121,127
Total costs assigned by the Cutting Department $fill in the blank ebea14f6a009fa1_40
3,135,609
b. Compute and evaluate the change in the costs per equivalent unit for direct materials and conversion from the previous month (December). If required, round your answers to two decimal places.
Increase or Decrease Amount
Change in direct materials cost per equivalent unit
$fill in the blank 0ff3b70effb1fa2_2
Change in conversion cost per equivalent unit
$fill in the blank 0ff3b70effb1fa2_4
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