The Polishing Department of Bonita Company has the following production and manufacturing cost data for September. Materials are entered at the beginning of the process. Production: Beginning inventory 1,580 units that are 100% complete as to materials and 30% complete as to conversion costs; units started during the period are 41,200; ending inventory of 6,600 units 10% complete as to conversion costs. Manufacturing costs: Beginning inventory costs, comprised of $20,600 of materials and $14,674 of conversion costs; materials costs added in Polishing during the month, $186,883; labor and overhead applied in Polishing during the month, $127,600 and $257,440, respectively. a. compute the equivalent units of production for materials and conversion costs for the month of september
b. compute the unit costs for materials and conversion costs for the month.
c. determine the costs to be assigne to the units transfered out in the process.

a. Materials = 15,780 units and Conversion = 9,840 units

b. Materials = $13.15 and Conversion = $40.62

c. $354,882

Explanation:

First calculate the number of Units Completed and Transferred

Units Completed and Transferred = 1,580 + 14, 200 - 6,600

                                                         = 9,180

Then, Calculation of the equivalent units of production for materials and conversion costs for the month of September

Materials

Units Completed and Transferred ( 9,180 × 100%)                =  9,180

Units In Ending Work In Process Inventory ( 6,600 × 100%) = 6,600

Equivalent units of production for materials                          = 15,780

Conversion

Units Completed and Transferred ( 9,180 × 100%)                =  9,180

Units In Ending Work In Process Inventory ( 6,600 × 10%)   =    660

Equivalent units of production for Conversion                      = 9,840

Calculate the unit costs for materials and conversion costs for the month.

Unit costs for materials = Total Materials Cost / Total Equivalent units of production for materials  

                                       = ($20,600 + $186,883) / 15,780

                                       = $13.15

Unit costs for Conversion = Total Conversion Cost / Total Equivalent units of production for Conversion  

                                       = ($14,674 + $127,600 + $257,440) / 9,840

                                       = $40.62

Calculate  the costs to be assigned to the units transferred out in the process.

Costs to be assigned  = Units Transferred Out × Total Cost per Equivalent unit of Production.

                                      = 6,600 × ($13.15 + $40.62)

                                      = 6,600 × $53.77

                                      = $354,882