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17-16 Equivalent units, zero beginninginventory.
Candid, Inc., is a manufacturer of digital cameras. It has twodepartments: assembly and testing. In January 2014, the companyincurred $800,000 on direct materials and $805,000 on conversioncosts, for a total manufacturing cost of $1,605,000. 1. Assumethere was no beginning inventory of any kind on January 1, 2014.During January, 5,000 cam-eras were placed into production and all5,000 were fully completed at the end of the month. What is theunit cost of an assembled camera in January? 2. Assume that duringFebruary 5,000 cameras are placed into production. Further assumethe same total assembly costs for January are also incurred inFebruary, but only 4,000 cameras are fully com-pleted at the end ofthe month. All direct materials have been added to the remaining1,000 cameras. However, on average, these remaining 1,000 camerasare only 60% complete as to conversion costs. (a) What are theequivalent units for direct materials and conversion costs andtheir respective costs per equivalent unit for February? (b) Whatis the unit cost of an assembled camera in February 2014? 3.Explain the difference in your answers to requirements 1 and2.
17-17 Journal entries (continuation of 17-16). Refer to requirement2 of Exercise 17-16.
Prepare summary journal entries for the use of direct materials andincurrence of conversion costs. Also prepare a journal entry totransfer out the cost of goods completed. Show the postings to theWork in Process account.