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Requirements 1. Prepare a production cost report for the Testing Department. 2. What is the cost per unit for lifts completed and transferred out to Finished Goods Inventory? Why would management be interested in this cost? More info The lifts are transferred to Finished Goods Inventory before shipment to marinas across the country. ReefWave's Testing Department requires no direct materials. Conversion costs are incurred evenly throughout the testing process. Other information follows for the month of August: Requirement 1. Prepare a production cost repon for the Testing Department. (Round all cost per unit amourts to the nearest cent and al other amouets to the nearest whole dolar. Ahberexaton used: EUP = equivalent inits of profuction.) RefiNave Production Cost Report.Testing Department Month Ended August 31 \begin{tabular}{lccccc} & & \multicolumn{3}{c}{ Equivalent Units } \\ \cline { 3 - 6 } & Physicat & Transterred & Direct & Converaion \\ UNITs & Units & ln & Materials & Costs \\ \hline \end{tabular} Units to acosunt for: Total units to acoount for Units accounted for: Total units accounted for Coot per equivilont vint Costs acoounted for: Tolat costs accounted for \begin{tabular}{cccc} Transferred & Direct & Comversion & Total \\ in & Materials & Costs & Costs \\ \hline \end{tabular} Requirement 2. What is the cost per unit for itis completed and tansterred out to Finished Goods inventery? Why would managerrent be interested in this cost? The coat per unt for lits corripleted and transferred out to Finiahed Goods twentory is per lit. Why would managoment be intoretsed in the cont per unit for ifts completed and transferred out to Finished Goods inventory? A. Managers would compare the average cost per ift against their budgeted costs to delermine whether the costs of the Testing Department remain under control. If budgeted costs are higher than the actual average cost per lift, then the maragtrs have done a good job controlling costs, In contrast, if the budgeted oosts are lower than the actual average cost per ift, managers will investigate the reason for the higher-than-expected costs in an eflert to regain control over costs. B. Managers use the cost per if for extemal financial reporting-specicaly to calculate the ending inventory balances on the Balance Sheet. C. Managers use the cost per if for exteenal financial reperting-specifealy to calculate the Cost of Goods Sold on the Income Statement. D. An of the abeve are reatons why mansgement woutd be intorested in thit cost per unat for ins completed and trantferres out to Finished Goods Invemtory