Question
Glass Designs Ltd manufactures decorative glass bowls. The firm employs a process costing system for its manufacturing operations. All direct materials are added at the beginning of the process, and conversion costs are incurred uniformly throughout the process. The company's production quantity schedule for March 2013 is as follows:
Units
Work in process on 1 March (60% complete as to conversion) 2,000
Units started during March 10,000
Total units to account for 12,000
Units from beginning work in process, which were completed and transferred out during March 2,000
Units started and completed during March 6,000
Work in process on 31 March (20% complete as to conversion) 4,000
Total units accounted for 12,000
Cost information:
Costs of Work in process (1 March):
- Materials.......................... $ 40,000
- Labour ............................ $ 12,000
- Overhead .........................$ 6,000
Costs added during the month (March) were as follows:
- Materials.......................... $ 200,000
- Labour ............................ $ 76,000
- Overhead .........................$ 38,000
Required:
(a) Prepare a schedule of equivalent units for each cost element for the month of March using the weighted average method.
(b) Prepare a schedule of equivalent units for each cost element for the month of March using the first in first out (FIFO) method.
(c) Calculate the cost (to the nearest cent) per equivalent unit for each cost element for the month of March using the weighted average method.
(d) Calculate the cost (to the nearest cent) per equivalent unit for each cost element for the month of March using the first in first out (FIFO) method.
(e) Determine the cost of ending work in process and the cost of finished goods transferred out during March using the weighted average method.
(f) Determine the cost of ending work in process and the cost of finished goods transferred out during March using the first in first out (FIFO) method.