(Standard process costing) Donbrowski Co. manufactures reflective lenses and uses a standard process costing system. For May 2010, the following data are available:
|
Standard Cost of 1 Unit |
|
|
Direct material |
$ 5.50 |
|
Conversion |
12.50 |
|
Total manufacturing cost |
$18.00 |
|
Beginning WIP Inventory |
10,000 units (100% DM; 70% conversion) |
|
Started in May |
180,000 units |
|
Completed in May |
150,000 units |
|
Ending WIP Inventory |
? units (100% DM; 60% conversion) |
|
Actual costs for May: |
|
|
Direct material |
$1,001,000 |
|
Conversion |
2,136,000 |
|
Total actual cost |
$3,137,000 |
a. Prepare an equivalent units of production schedule.
b. Prepare a cost of production report and assign costs to goods transferred and to inventory.
c. Calculate and label the variances and close them to Cost of Goods Sold.