Question: Beautiful Lips produces a lip balm to prevent chapped lips

Beautiful Lips produces a lip balm to prevent chapped lips. The balm is manufactured in a single processing department. No lip balm was in process on May 31, and Beautiful Lips started production on 20,100 lip balm tubes during June. Direct materials are added at the beginning of the process, but conversion costs are incurred evenly throughout the process.
Completed production for June totalled 15,500 units. The June 30 work in process was 45% of the way through the production process. Direct materials costing $4,060 were placed in production during June, and direct labour of $3,375 and manufacturing overhead of $2,425 were assigned to the process.
1. Draw the time line for Beautiful Lips.
2. Use the time line to help you compute the total equivalent units and the cost per equivalent unit for June.
3. Assign total costs to (a) units completed and transferred to Finished Goods and (b) units
still in process at June 30.
4. Prepare a T-account for Work in Process Inventory to show activity during June, including the June 30 balance.

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  • CreatedApril 30, 2015
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