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We produce picture frames for stores such as Michael’s and Hobby Lobby. In the assembly department,...

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Accounting

We produce picture frames for stores such as Michael’s and HobbyLobby. In the assembly department, the wooden slats are added atthe beginning of the process, and the glass is added when theprocess is 25% complete. Conversion costs are added evenlythroughout the period. Here is the data related to the assemblydepartment for November 2018:

WIP, November 1 (40% complete) 60 frames

Started in November 500 frames

WIP, November 30 (15% complete) 100 frames

Costs included in the Beginning WIP:

DM - wooden slats $ 300

DM - glass $ 180

CC $ 168

Costs added during November:

DM - wooden slats $ 2,950

DM - glass $ 1,500

CC $ 3,580

Note: When calculating equivalent units (Step 2), total costs(Step 3), and cost per equivalent unit (Step 4), you will have 3columns - DM slats, DM glass, and CC. Therefore, when you assigncosts in Step 5, you’ll assign all 3 costs for each layer.

Using Weighted Average:

a. Prepare T-accounts for WIP in units and in $ to representthis situation.

b. Prepare the 5-step Production Cost Report.

c. Update the T-accounts to reflect the amounts transferred outand the amounts in Ending WIP.

Answer & Explanation Solved by verified expert
4.0 Ratings (491 Votes)
Step for solution Step 1 Equivalent Units of production Physical units multiplied by of the competition Step 2 Calculate the total cost to be accounted for Step 3 Cost per Equivalent Unit total cost to be accounted for Equivalent Units of production Step 4 The cost assigned to units transferred out units completed and transferred out Cost per Equivalent Unit Step 5 The cost assigned to units ending work in progress equivalent units in ending WIP inventory Cost per    See Answer
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