The new manager of the cpu assembly department was asked to

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Reference no: EM13484275

Bell Computers, Ltd., located in Liverpool, England, assembles a standardized personal computer from parts it purchases from various suppliers. The production process consists of several steps, starting with assembly of the "mother" circuit board, which contains the central processing unit. This assembly takes place in the CPU Assembly Department. The company recently hired a new accountant who prepared the following report for the department for May using the weighted-average method:


Units to be accounted for:
Work in process, May 1: materials 90% complete; conversion 80% complete	8,700
Started into production	37,600

Total units	46,300

Units accounted for as follows:
Transferred to next department	37,100
Work in process, May 31: materials 75% complete; conversion 50% complete	9,200

Total units	46,300

Cost Reconciliation
Cost to be accounted for:
Work in process, May 1	£	24,534
Cost added in the department		115,404

Total cost to be accounted for	£	139,938

Cost accounted for as follows:
Work in process, May 31	£	19,734
Transferred to next department		120,204

Total cost accounted for	£	139,938

The company's management would like some additional information about May's operation in the CPU Assembly Department. (The currency in England is the pound, which is denoted by the symbol £.)

Required:

1.	How many units were started and completed during May?

Units started and completed during May

2.	What were the equivalent units for May for materials and conversion costs?

	Materials	Conversion
Equivalent units of production

3.	What were the costs per equivalent unit for May? The following additional data are available concerning the department's costs: (Omit the "£" sign in your response)

	Materials		Conversion		Total
Work in process, May 1	£	16,530	£	8,004	£	24,534
Costs added during May	£	75,870	£	39,534	£	115,404

	Materials	Conversion
Cost per equivalent unit	£	£

4.	Calculate the material cost and the conversion cost of the ending work in process. (Omit the "£" sign in your response.)

	Materials	Conversion	Total
Ending work in process inventory:
Equivalent units of production
Cost per equivalent unit	£	£
Cost of ending work in process inventory	£	£	£

The new manager of the CPU Assembly Department was asked to estimate the incremental cost of processing an additional 1,000 units through the department. He took the unit cost for an equivalent whole unit you computed in (3) above and multiplied this figure by 1,000. Will this method yield a valid estimate of incremental cost?

	Yes
	No

Reference no: EM13484275

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