P165A Polk Company manufactures basketballs Materials are ad

P16-5A) Polk Company manufactures basketballs. Materials are added at the beginning of Determine equivalent units and the production data for the month of July 2017 are as follows. process and conversion costs are incurred uniformly. Production and cost unit costs and assign costs. (LO 3, 4), AP Production Data-Basketballs Work in process units, July 1 Units started into production Work in process units, July 31 Units 500 1,000 600 Percentage Complete 60% 40% Cost Data-Basketballs Work in process, July 1 Materials $750 600 Conversion costs Direct materials Direct labor Manufacturing overhead $1,350 2,400 1,580 1,240 Instructions (a) Calculate the following. (1) The equivalent units of production for materials and conversion costs. (2) The unit costs of production for materials and conversion costs. (3) The assignment of costs to units transferred out and in process at the end of the (a) (2) Materials $ 2.10 (3) Transferred $4,590 $1,980 out accounting period. Prepare a production cost report for the month of July for the basketballs WIP (b)

Solution

Equivalent Units a) 1 Physical Units Materials Conversion costs Units to be accounted for Work in progress, July 1 500 Started into production 1000 Total Units 1500 Units accounted for Transferred out 900 900 900 Work in process, July 31 600 600 240 Total Units 1500 1500 1140 2 Material Costs Conversion Costs Beginning work in process 750 600 Added during the month 2400 2820 (1580+1240) Total 3150 3420 Equivalents Units 1500 1140 Unit costs                      2.10                      3.00 3 Costs accounted for Cost of units transferred out(900*5.10) 4590 Cost of units in process at the end of the period (600*2.10) 1260 (240*3) 720 1980 b) Production Cost report Polk Company Production report for July Physical Units Materials Conversion costs Units to be accounted for Work in process, July 1 500 Started into production 1000 Total Units 1500 Units accounted for Transferred out 900 900 900 Work in process, July 31 600 600 240 Total units 1500 1500 1140 Unit Costs Total Cost 3150 3420 6570 Equivalent units 1500 1140 2.1 3 5.1 Costs to be accounted for Work in process, July 1 1350 Started into production 5220 Total Costs 6570 Cost reconciliation Schedule Costs accounted for Transferred out(900*5.10) 4590 Work in process, July 31 Materials 600*2.10 1260 Conversion costs 240*3 720 1980 Total Costs 6570