Old Victrola, Inc., produces top-quality stereos and uses process costing. The manufacture of stereos is such that direct materials, labor, and overhead are all added evenly throughout the production process. Due to the smooth production process, only one cost category-manufacturing costs-is used for equivalent unit calculations. Old Victrola had the following cost and production information available for the months of March and April. Direct materials costs Direct labor costs Manufacturing overhead applied Total manufacturing costs Units in beginning work in process Units transferred to finished goods Units in ending work in process $ March 978,460 2,562,260 3,438,640 $ 6,979,360 April $ 1,168,310 3,041,940 3,571,030 $ 7,781,280 7,000 18,500 4,800 4,800 23,000 6,400 Beginning work in process was 30 percent complete in March and 60 percent complete in April. Ending work in process was 60 percent complete in March and 35 percent complete in April. a. For each of the two months, calculate the equivalent units of production. b-1. For each of the two months, calculate the manufacturing cost per equivalent unit. b-2. Based on equivalent units produced, did total manufacturing costs per unit increase or decrease between March and April? c-1. For each of the two months, calculate the direct materials cost per equivalent unit. c-2. Did the direct materials cost per equivalent unit increase or decrease between March and April?
Old Victrola, Inc., produces top-quality stereos and uses process costing. The manufacture of stereos is such that direct materials, labor, and overhead are all added evenly throughout the production process. Due to the smooth production process, only one cost category-manufacturing costs-is used for equivalent unit calculations. Old Victrola had the following cost and production information available for the months of March and April. Direct materials costs Direct labor costs Manufacturing overhead applied Total manufacturing costs Units in beginning work in process Units transferred to finished goods Units in ending work in process $ March 978,460 2,562,260 3,438,640 $ 6,979,360 April $ 1,168,310 3,041,940 3,571,030 $ 7,781,280 7,000 18,500 4,800 4,800 23,000 6,400 Beginning work in process was 30 percent complete in March and 60 percent complete in April. Ending work in process was 60 percent complete in March and 35 percent complete in April. a. For each of the two months, calculate the equivalent units of production. b-1. For each of the two months, calculate the manufacturing cost per equivalent unit. b-2. Based on equivalent units produced, did total manufacturing costs per unit increase or decrease between March and April? c-1. For each of the two months, calculate the direct materials cost per equivalent unit. c-2. Did the direct materials cost per equivalent unit increase or decrease between March and April?
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter6: Process Cost Accounting—additional Procedures; Accounting For Joint Products And By-products
Section: Chapter Questions
Problem 8E: Sonoma Products Inc. manufactures a liquid product in one department. Due to the nature of the...
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Transcribed Image Text:Old Victrola, Inc., produces top-quality stereos and uses process costing. The manufacture of stereos is such that direct materials,
labor, and overhead are all added evenly throughout the production process. Due to the smooth production process, only one cost
category-manufacturing costs-is used for equivalent unit calculations. Old Victrola had the following cost and production information
available for the months of March and April.
Direct materials costs
Direct labor costs
Manufacturing overhead applied
Total manufacturing costs
Units in beginning work in process
Units transferred to finished goods
Units in ending work in process
$
March
978,460
2,562,260
3,438,640
$ 6,979,360
April
$ 1,168,310
3,041,940
3,571,030
$ 7,781,280
7,000
18,500
4,800
4,800
23,000
6,400
Beginning work in process was 30 percent complete in March and 60 percent complete in April. Ending work in process was 60
percent complete in March and 35 percent complete in April.
a. For each of the two months, calculate the equivalent units of production.
b-1. For each of the two months, calculate the manufacturing cost per equivalent unit.
b-2. Based on equivalent units produced, did total manufacturing costs per unit increase or decrease between March and April?
c-1. For each of the two months, calculate the direct materials cost per equivalent unit.
c-2. Did the direct materials cost per equivalent unit increase or decrease between March and April?
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