LO.2 (WA EUP & cost assignment) Ro-Day-O Inc. manufactures belt buckles in a single-step production process. The following information is available for June 2010:
Whole Units Cost of Material Cost of Labor
Beginning
work in
process 200,000 $1,200,000 $1,728,000
Units
started
during
period 1,000,000 7,800,000 9,612,000
Units in
ending
inventory 300,000
Beginning inventory units were 100 percent complete as to material and 80 percent complete as to labor. The ending inventory units were 100 percent complete as to material and 50 percent complete as to labor. Overhead is applied to production at the rate of 60 percent of direct labor cost.
a. Prepare a schedule to compute equivalent units of production by cost component assuming the weighted average method.
b. Determine the unit production costs for material and conversion.
c. Calculate the costs assigned to completed units and ending inventory for August 2010.