Production costs chargeable to the Finishing Department in June in Hollins Company are materials $15,398, labor $39,891, overhead $18,800. Equivalent units of production are materials 20,260 and conversion costs 19,180. Production records indicate that 18,100 units were transferred out, and 2,160 units in ending work in process were 50% complete as to conversion cost and 100% complete as to materials.

Prepare a cost reconciliation schedule.

Question

Business

Braelyn

15 May, 00:10

Production costs chargeable to the Finishing Department in June in Hollins Company are materials $15,398, labor $39,891, overhead $18,800. Equivalent units of production are materials 20,260 and conversion costs 19,180. Production records indicate that 18,100 units were transferred out, and 2,160 units in ending work in process were 50% complete as to conversion cost and 100% complete as to materials.

Prepare a cost reconciliation schedule.

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Answers (1)

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Meredith Higgins · Answer 1

Answer and Explanation:

Cost per equivalent unit = Production cost / Equivalent units

Material cost per equivalent unit = $15,398 / 20,260 = $0.76

Conversion cost per equivalent unit = ($39,891 + $18,800) / 19,180 = $3.06

Cost Reconciliation Schedule:

Cost accounted for:

Transferred out [18,100 x ($0.76 + $3.06) ] $69,142

Work in process:

Materials (2,160 x $0.76) $1,642

Conversion costs (2,160 x $3.06 x 0.5) $3,305

$4,947

Total cost accounted for $74,089