Lopez Cosmetics produces a lip balm used for cold weather
Lopez Cosmetics produces a lip balm used for cold- weather sports. The balm is manufactured in a single processing department. No lip balm was in process on May 31, and Lopez Lips started production on 20,900 lip balm tubes during June. Direct materials are added at the beginning of the process, but conversion costs are incurred evenly through-out the process. Completed production for June totaled 15,700 units. The June 30 work in process was 45% of the way through the production process. Direct materials costing $ 5,225 were placed in production during June, and direct labor of $ 3,360 and manufacturing overhead of $ 248 were assigned to the process.

1. Draw a time line for Lopez Cosmetics.
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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