Question: The Shop Supply Company produces rolls of disposable shop towels

The Shop Supply Company produces rolls of disposable shop towels that it supplies to auto parts outlets and industrial cleaning supplies distributors. Shop towels are similar to paper towels, but they are thicker and more durable and textured to deal more effectively with grease and grime than the traditional paper towel sold for home use. The continuous sheet of paper material is run through the Sizing and Rolling Department, where the paper is cut to the appropriate length and rolled onto cardboard tubes. The rolls then move on to the Packaging Department, where they are shrink-wrapped and packed into cases for delivery to customers. During March, the Sizing and Rolling Department transferred 45,000 rolls of paper to the Packaging Department. The ending inventory in March in the Sizing and Rolling Department consisted of 4,000 rolls that were 100% complete with respect to materials and 80% complete with respect to conversion. The costs per equivalent unit for the month were materials, $10.50, and conversion, $4.00.
Prepare the cost reconciliation portion of the Sizing and Rolling Department’s production report for March.

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  • CreatedJuly 08, 2015
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