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Homework answers / question archive / Leslie Company uses an automated process to manufacture its glass products

Leslie Company uses an automated process to manufacture its glass products

Accounting

Leslie Company uses an automated process to manufacture its glass products. For January, the company had the following activities:

 

Beginning work in process inventory

6,000 items, 1/4 complete

Units placed in production

14,000 units

Units completed

17,000 units

Ending work in process inventory

3,000 items, 50% complete

 

 

Cost of beginning work in process

P36,000

Direct material costs, current

 42,000

Conversion costs, current

P68,000

Direct materials are placed into production at the beginning of the process and conversion costs are incurred evenly throughout the process.

 

Required:

Prepare a production cost worksheet using the FIFO method

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UNITS TO ACCOUNT FOR:        
Beginning Work in Process units   6,000    
Add: Units Started in Process   14,000    
Total Units to account for:   20,000    
             
UNITS TO BE ACCOUNTED FOR:        
Units completed from Beginning WIP 6000    
Units started and completed   11,000    
Ending Work in Process   3,000    
Total Units to be accounted for: 20,000    
             
Equivalent Units:          
      Material Cost Conversion
      % Completion Units % Completion Units
Units completed from Beg. WIP 0% 0 75.00% 4,500
Units started and completed 100% 11,000 100% 11,000
Ending Work in Process 100% 3,000 50% 1,500
Total Equivalent units   14,000   17,000
             
COST PER EQUIVALENT UNIT:        
      Material   Conversion  
Total cost added during the year 42,000   68,000  
Equivalent Units   14,000   17,000  
Cost per Equivalent unit 3.00   4.00  
             
TOTAL COST ACCOUNTED FOR:        
             
Units Completed from Beginning WIP (6000 units)    
      Equivalent unit Cost per EU Total Cost  
Beginning Cost       36000  
Material     0 $3  0  
Conversion Cost   4,500 $4  $18,000   
Cost of units completed from Beg WIP   $54,000   
Units started and Transferred out (11000 units)    
      Equivalent unit Cost per EU Total Cost  
Material     11,000 $3  $33,000   
Conversion Cost   11,000 $4  $44,000   
Total Cost of Units completed and transferred out: $77,000   
             
Ending Work in process (3,000 units)      
      Equivalent unit Cost per EU Total Cost  
Material     3,000 $3  $9,000   
Conversison Cost   1,500 $4  $6,000   
Total cost of Ending Work in process:   15,000  
             
Total Cost of completed units     146,000  
             

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