Problem:
Swinn Company manufactures bicycles. Materials are added at the beginning of the production process, and conversion costs are incurred uniformly. Production and cost data for the month of May are as follows.
|
|
Percent
|
|
Production Data-Bicycles
|
Units
|
Complete
|
|
Work in process units, May 1
|
500
|
80%
|
|
Units started in production
|
2,000
|
|
|
Work in process units, May 31
|
800
|
40%
|
|
Cost Data-Bicycles
|
|
|
|
Work in process, May 1
|
|
|
|
Materials
|
$15,000
|
|
|
Conversion costs
|
18,000
|
$33,000
|
|
Direct materials
|
|
50,000
|
|
Direct labor
|
|
19,020
|
|
Manufacturing overhead
|
|
33,680
|
Instructions
(a) Calculate the following.
(1) The equivalent units of production for materials and conversion.
(2) The unit costs of production for materials and conversion costs.
(3) The assignment of costs to units transferred out and in process at the end of the accounting period.
(b) Prepare a production cost report for the month of May for the bicycles.