Muskoge Company uses a process-costing system. The company manufactures a product that is processed in two departments: Molding and Assembly. In the Molding Department, direct materials are added at the beginning of the process; in the Assembly Department, additional direct materials are added at the end of the process. In both departments, conversion costs are incurred uniformly throughout the process. As work is completed, it is transferred out. The following table summarizes the production activity and costs for February: Molding Assembly Beginning inventories: Physical units 10,000 8,000 Costs: Transferred in — $45,300 Direct materials $22,000 — Conversion costs $13,800 $16,900 Current production: Units started 25,000 ? Units transferred out 30,000 35,000 Costs: Transferred in — ? Direct materials $56,250 $40,250 Conversion costs $103,500 $143,000 Percentage of completion: Beginning inventory 40% 50% Ending inventory 80 50 Required:
Muskoge Company uses a process-costing system. The company manufactures a product that is processed in two departments: Molding and Assembly. In the Molding Department, direct materials are added at the beginning of the process; in the Assembly Department, additional direct materials are added at the end of the process. In both departments, conversion costs are incurred uniformly throughout the process. As work is completed, it is transferred out. The following table summarizes the production activity and costs for February: Molding Assembly Beginning inventories: Physical units 10,000 8,000 Costs: Transferred in — $45,300 Direct materials $22,000 — Conversion costs $13,800 $16,900 Current production: Units started 25,000 ? Units transferred out 30,000 35,000 Costs: Transferred in — ? Direct materials $56,250 $40,250 Conversion costs $103,500 $143,000 Percentage of completion: Beginning inventory 40% 50% Ending inventory 80 50 Required:
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter6: Process Costing
Section: Chapter Questions
Problem 17E: K-Briggs Company uses the FIFO method to account for the costs of production. For Crushing, the...
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FIFO Method, Two-Department Analysis
Muskoge Company uses a process-costing system. The company manufactures a product that is processed in two departments: Molding and Assembly. In the Molding Department, direct materials are added at the beginning of the process; in the Assembly Department, additional direct materials are added at the end of the process. In both departments, conversion costs are incurred uniformly throughout the process. As work is completed, it is transferred out. The following table summarizes the production activity and costs for February:
Molding | Assembly | |||
Beginning inventories: | ||||
Physical units | 10,000 | 8,000 | ||
Costs: | ||||
Transferred in | — | $45,300 | ||
Direct materials | $22,000 | — | ||
Conversion costs | $13,800 | $16,900 | ||
Current production: | ||||
Units started | 25,000 | ? | ||
Units transferred out | 30,000 | 35,000 | ||
Costs: | ||||
Transferred in | — | ? | ||
Direct materials | $56,250 | $40,250 | ||
Conversion costs | $103,500 | $143,000 | ||
Percentage of completion: | ||||
Beginning inventory | 40% | 50% | ||
Ending inventory | 80 | 50 |
Required:
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