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Problem 3-2A (Video) Rosenthal Company manufactures bowling balls through two processes: Molding and Packaging
Problem 3-2A (Video)
Rosenthal Company manufactures bowling balls through two processes: Molding and Packaging. In the Molding Department, the urethane, rubber, plastics, and other materials are molded into bowling balls. In the Packaging Department, the balls are placed in cartons and sent to the finished goods warehouse. All materials are entered at the beginning of each process. Labor and manufacturing overhead are incurred uniformly throughout each process. Production and cost data for the Molding Department during June 2020 are presented below.
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Production Data |
June |
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| Beginning work in process units | 0 | ||
| Units started into production | 28,160 | ||
| Ending work in process units | 2,560 | ||
| Percent complete—ending inventory | 40 | % | |
|
Cost Data |
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| Materials | $253,440 | |
| Labor | 68,608 | |
| Overhead | 144,384 | |
| Total | $466,432 |
Prepare a schedule showing physical units of production.
Determine the equivalent units of production for materials and conversion costs.
Compute the unit costs of production.
Determine the costs to be assigned to the units transferred out and in process for June.
Prepare a production cost report for the Molding Department for the month of June.
Expert Solution
Prepare a schedule showing physical units of production.
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Units to be accounted for |
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Work in process, June 1 |
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Started into production |
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Total units |
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Units accounted for |
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Transferred out |
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Work in process, June 30 |
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Total units |
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Determine the equivalent units of production for materials and conversion costs.
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Materials |
Conversion Costs |
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| Total equivalent units |
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Compute the unit costs of production.
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Materials |
Conversion Costs |
Total Unit Cost |
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| Unit Costs | $
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$
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$
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Determine the costs to be assigned to the units transferred out and in process for June.
| Transferred out | $
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| Work in process, June 30 | $
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Prepare a production cost report for the Molding Department for the month of June.
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ROSENTHAL COMPANY
Molding Department Production Cost Report For the Month Ended June 30, 2020 |
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Equivalent Units
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Quantities
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Physical
Units |
Materials |
Conversion
Costs |
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Units to be accounted for
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Work in process, June 1
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Started into production
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Total units
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Units accounted for
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Transferred out
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Work in process, June 30
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Total units
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Costs |
Materials |
Conversion
Costs |
Total |
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Unit costs
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Total Costs
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$
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$
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$
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Equivalent units
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Unit costs
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$
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$
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$
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Costs to be accounted for
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Work in process, June 1
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$
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Started into production
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Total costs
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$
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Cost Reconciliation Schedule
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Costs accounted for
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Transferred out
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$
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Work in process, June 30
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Materials
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$
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Conversion costs
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Total costs
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$
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Explanations:
Prepare a schedule showing physical units of production.
| Physical units | ||
|
Units to be accounted for |
||
|
Work in process, June 1 |
|
|
|
Started into production |
|
|
|
Total units |
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Units accounted for |
||
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Transferred out |
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Work in process, June 30 |
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Total units |
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Materials
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Conversion Costs
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| Units transferred out | 25,600 | 25,600 | ||
| Work in process, June 30 | ||||
| 2,560 × 100% | 2,560 | |||
| 2,560 × 40% | 1,024 | |||
| Total equivalent units | 28,160 | 26,624 |
(Mat.: 25,600 + (2,560 x 100%) = 28,160)
(Mat.: Units transfrd. out + (End. WIP units x % compltd.) = Tot. equiv. units)
(CC: 25,600 + (2,560 x 40%) = 26,624)
(CC: Units transfrd. out + (End. WIP units x % compltd.) = Tot. equiv. units)
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Unit Costs
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| Materials | $9 ($253,440 ÷ 28,160) | |
| Conversion costs | $8 ($212,992* ÷ 26,624) | |
| Total unit cost | $17 ($9 + $8) |
*$68,608 + $144,384 = $212,992
(Mat.: $253,440 ÷ 28,160 = $9)
(Mat.: Mat. costs ÷ Mat. equiv. units = Mat. cost/unit)
(CC: ($68,608 + $144,384
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