Acc346 Managerial Accounting: P3-2 Marquita Filters produces an air filter for use

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Acc346 Managerial Accounting
Week 2 Homework

PROBLEM 3-2. Comprehensive Problem, One Department
Marquita Filters produces an air filter for use in jet aircraft. Parts are added at several points in the production process. In August, production began with 500 filters in Work in Process, 80 percent complete as to materials and 70 percent complete as to labor and overhead. During the month, an additional 2,700 units were started into production. Six hundred filters were in Work in Process at the end of the month, and they were 70 percent complete as to materials and 60 percent complete as to labor and overhead.
Cost Information for August Beginning Work in Process Inventory Cost Added in August
Direct material 45,000 269,080
Direct labor 11,000 77,800
Manufacturing overhead 80,000 497,200
Total $136,000 $844,080

Required
a. Calculate the cost per equivalent unit for each of the three cost items and in total.
b. Calculate the cost of items completed in August and the cost of ending Work in Process inventory.
c. Reconcile the sum of the two costs in part b to the sum of beginning Work in Process and costs added in August.
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