Texarkana Corporation assembles various components used in the computer industry. The company's major product, a disk drive,
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•Beginning work-in-process inventory: 3,000 units, 80 percent complete as to conversion; cost, $293,940 (direct material, $230,000; conversion, $63,940).
• Production started: 27,000 units.
• Production completed: 26,000 units.
• Ending work-in-process inventory: 4,000 units, 45 percent complete as to conversion.
• Direct material used: JR1163, $225,000; JY1065, $710,000; DC0766, $455,000.
• Hourly wage of direct laborers, $21; total direct-labor payroll, $134,274.
• Overhead application rate: $69 per direct-labor hour.
All parts are introduced at the beginning of the manufacturing process; conversion cost is incurred uniformly throughout production.
Required:
1. Calculate the total cost of direct material and conversion during April.
2. Determine the cost of goods completed during the month.
3. Determine the cost of the work-in-process inventory on April 30.
4. With regard to the ending work-in-process inventory:
a. How much direct-material cost would be added to these units in May?
b. What percentage of conversion would be performed on these units in May?
5. Assume that the disk drive required the addition of another part (TH55) at the 75 percent stage of completion. How many equivalent units with respect to part TH55 would be represented in April's ending work-in-process inventory?
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Related Book For
Managerial Accounting Creating Value in a Dynamic Business Environment
ISBN: 978-0078025662
10th edition
Authors: Ronald Hilton, David Platt
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