Pena Gifts makes unique western gifts that are sold at souvenir shops. One of the company€™s more popular products is a ceramic eagle that is produced in a mass production process that entails two manufacturing stages. In the first production stage, ceramic glass is heated and molded into the shape of the eagle by the Compression Department. Finally, color and artistic detail is applied to the eagle by the Finishing Department. The company has just hired a new accountant who will be responsible for preparing the Cost of Production Report for June 2014. The accountant is given the following information from which to prepare his report.
Departmental Cost Information for June:

Departmental Product Information for June:

Required
a. Prepare a Cost of Production Report for the Compression Department for June.
b. Prepare a Cost of Production Report for the Finishing Department for June.
c. If 24,000 units are sold in June for $160,000, determine the company€™s gross margin forJune.

Transcribed Image Text:

Compression Finishing $3,000 $14,400 Costs in beginning inventory Costs added during June: Materials Labor Overhead 42,000 20,000 90,000 18,120 13,200 62,000 Compression Finishing 3,600 Units in beginning inventory Units started Units in ending inventory 10,000 52,000 16,000 (25% complete) 46,000 9,600 (80% complete)