I am astounded that we cannot find the cost records for the month of July 2021” said Greg Andrews, plant manager of Detroit Component Works (DCW). “ I have a division meeting to attend where I will be asked about the plant’s July performance compared to June. All I have now are the weighted average cost figures, but those numbers are hardly helpful in answering the question of whether we have improved the efficiency of our performance this month compared to the previous months. I think we have improved the efficiency of our operations. so I was expecting to report some good news at the division meeting. I need those July numbers now.” DCW makes complex aircraft engine components in one operation which combines —machining and assembly. After the units are completed they are transferred to cost of goods sold.

The below is a summary of the Assembly operations in July of 2021.

Physical Direct Conversion

Units Materials Cost

W-in-P, 7/1* 120 $15,000 $8,325

Cost Added

during July 200

Completed

during July 220

W-in-P, 7/31** 100

Cost Added

during July ? ?

Weighted average cost

Per equivalent unit $131.25 $114

* Degree of Completion: Direct Materials, 100%; Conversion Cost, 62.5%

**Degree of Completion: Direct Materials, 100%, Conversion Cost, 80%.

Instructions:

For each cost element (Direct Materials and Conversion Cost) compute the unit cost for work that was done on the 7/1 units prior to 7/1.

For each cost element (Direct Materials and Conversion Cost), compute the equivalent units of work done in the current period only. (FIFO).

Calculate the Assembly Department costs to account for in July 2021 for each cost element. (Direct Materials and Conversion Cost) (You will need to use the weighted average method to determine this.)

 

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3. Calculate the Assembly Department costs to account for in July of 2021 for Direct Materials and Conversion cost. The first set information below is set up to help you prepare for the information in the second set of information. 7/1/2021 Current Cost Total cost to account for 7/1/21 Current Cost Total cost to account for Opening W-I-P Started & Completed Ending W-I-P Equivalent units under WAC 4. UNIT COST Total $ = Total EUP . Direct Materials 120 100 100 320 4. For Direct Materials and Conversion cost calculate the cost per equivilent unit of work performed in the current period only. FIFO. Direct Materials Direct Materials Conversion Cost + 120 100 80 300 Conversion Cost Conversion Cost 3. Calculate the Assembly Department costs to account for in July of 2021 for Direct Materials and Conversion cost. The first set information below is set up to help you prepare for the information in the second set of information. 7/1/2021 Current Cost Total cost to account for 7/1/21 Current Cost Total cost to account for Opening W-I-P Started & Completed Ending W-I-P Equivalent units under WAC 4. UNIT COST Total $ = Total EUP . Direct Materials 120 100 100 320 4. For Direct Materials and Conversion cost calculate the cost per equivilent unit of work performed in the current period only. FIFO. Direct Materials Direct Materials Conversion Cost + 120 100 80 300 Conversion Cost Conversion Cost

Answer rating: 100% (QA)

3 Calculate the Assembly Department costs to account for in July of 2021 for Direct Materials and Conversion cost The first step is to determine the unit cost for work done on the 71 units prior to 71 ... View the full answer