The cutting department of Chan Manufacturing has the following production and cost data for August.
Production
1. Started and completed 8,000 units.
2. Started 2,000 units that are 40% completed at August 31.
Costs
Beginning work in process ........................ $ 0
Materials ............................................. 45,000
Labour ............................................... 14,700
Manufacturing overhead ......................... 16,100
Materials are entered at the beginning of the process. Conversion costs are incurred uniformly during the process. Chan Manufacturing uses the FIFO method to calculate equivalent units.
Instructions
(a) Determine the equivalent units of production for
(1) Materials
(2) Conversion costs.
(b) Calculate unit costs and show the assignment of manufacturing costs to units transferred out and in work in process.