E33 Answer questions on costs and production LO2 3 4 AP The

E33 Answer questions on costs and production. LO2 3. 4), AP The ledger of American Company has the following work in process account. Work in Process -Painting Balance 3,90S31 Transferred out ? 5.31 Materials 5,160 3 Labo 2,530 531 Overhead 1,380 531 Balance red out. The begin ung work in process had materials cost of S2 040 and conversion costs of si 550. The Production records showtiat there were 4 0 units in the begann ng vet tor 30% compete 1,600 usats started, and 1 700 units trans units ul endag inventory were 40% complete. Materials are entered at the beginning ofthe painting process. Instrucrions (a) How many units are in process at May 31 (b) What is the uni: materials cost for May? (c) What is the unit coavesionc or May? (d) What is the total cost of units transferred out in May? ( What is the cost of the May 31 inventory?

Solution

a) Ending work in process = 400+1600-1700 = 300 units

b) Unit cost of material = (2040+5160)/2000 = 3.60

c) Unit cost of conversion = (2530+1380+1550)/1820 = 3

d) Cost of units transferred out in may = (3+3.60)*1700 = $11220

e) Cost of the may 31 inventory = (300*3.6+120*3) = $1440