Costs Work in process, October 1* Started during October 2020 Physical Units (Gallons of Paint) 16,000 44,000 Direct Materials $2,800,000 Completed during October 2020 51,000 Work in process, October 31 9,000 Total costs added during October 2020 x Degree of completion: direct materials, 100%; conversion costs, 60%. y Degree of completion: direct materials, 100%; conversion costs, 70%. $9,400,000 Conversion $ 901,400 $5,111,000
Caricolor Limited operates a paint manufacturing plant, housing two distinct departments: the mixing department and the quality control department. The paint undergoes sequential processing in both of these departments.
The company's process-costing system is structured around two primary cost categories: direct materials and conversion costs. Direct materials are introduced at the initial stages of the process, while conversion costs are gradually incurred throughout the process. After completion of the mixing department's tasks on the paint, the product is promptly forwarded to the quality control department. Caricolor employs the weighted-average method for
Data for the mixing department for October 2020 are as follows:
Required:
3. Assign total costs to units completed and transferred out and to units in ending work in process?
4. By reference to the above data, explain the concept of equivalent units in process costing?
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