Question - L Corp. produces exterior latex paint, which it sells in one-gallon containers. The company has two processing departments-Base Fab and Finishing. White paint, which is used as the base for all the company's paints, is mixed from raw ingredients in the Base Fab Department. Pigments are added to the basic white paint, the pigmented paint is squirted under pressure into one-gallon containers, and the containers are labeled and packed for shipping in the Finishing Department. Information relating to the company's operations for April follows:
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Base Fab
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Finishing
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Raw materials were issued for use in production:
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$851,000
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$629,000
|
|
Direct Labor costs were incurred:
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$330,000
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$270,000
|
|
Manufacturing Overhead costs were applied:
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$665,000
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$405,000
|
|
The cost of basic white paint was transferred from the Base Fab Department to the Finishing Department:
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$1,850,000
|
|
Paint that had been prepared for shipping was transferred from the Finishing Department to the Finished Goods. Its cost according to the company's cost system was
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$3,200,000
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Production data:
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Units
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Units (gallons) in process, April 1: Materials 100% complete, labor and overhead 60% complete
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30,000
|
|
Units (gallons) started into production during April :
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420,000
|
|
Units (gallons) completed and transferred to the Finishing department :
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370,000
|
|
Units (gallons) in process, April 30: Materials 50% complete, labor and overhead 25% complete
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75,000
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Cost data:
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|
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Work in Process, inventory, April 1:
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|
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Materials
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$92,000
|
|
Labor
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$21,000
|
|
Overhead
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$37,000
|
|
Total cost of work in processs
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$150,000
|
|
|
|
Cost added during April:
|
|
|
Materials
|
$851,000
|
|
Labor
|
$330,000
|
|
Overhead
|
$665,000
|
|
Total cost added during April
|
$1,846,000
|
Losses are considered continuous and are found at the end of production. Any losses over 1% of completed units are considered abnormal.
Determine the equivalent units of production for direct materials, direct labor and overhead if the company uses weighted average method.
a) Calculate the number of normal losses.
b) Calculate the number of abnormal losses.
c) Calculate the units started and completed.
d) Calculate the equivalent units of production for direct materials.
e) Calculate the equivalent units of production for direct labor and overhead.
Attachment:- Assignment Files.rar