The sanding department of Richards Furniture Company has the following production and manufacturing cost data for March 2014, the first month of operation.
Production: 9,000 units finished and transferred out: 3,000 units started that are 100% complete as to materials and 20% complete as to conversion costs.
Manufacturing costs: materials: $33,000, labor: $24,000, overhead: $36,000
Prepare a production cost report.
Production Cost Report
A Production Cost Report summarizes how total costs incurred for a period are allocated. Costs are typically allocated to units completed and transferred as well as units that remain in ending work in process inventory. The allocation of cost is essential in process costing to determine accurate product cost.
Answer and Explanation: 1
Production cost report is prepared as follows:
|Units||Equivalent units Materials||Equivalent units Conversion|
|Units finished and transferred out||9,0...|
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fromChapter 6 / Lesson 4
The production of a cost report aids in keeping a record of spending and materials that are utilized by a business. Learn more about what a production cost report is, how many units, counting units, and how to understand what was spent and if it was the company that spent it.