The Duolane Pottery Manufactures Pottery Products

question 135

Essay

The Duolane Pottery manufactures pottery products. All direct materials are included at the inception of the production process. For April, there was no beginning inventory in the processing plant. Direct materials totaled $180,000 for the month. Work-in-process records revealed that 3,000 tons were started in April and that 2,100 tons were finished; 500 tons were spoiled as expected. Ending work-in-process units are complete in respect to direct materials costs. Spoilage is not detected until the process is complete.
Required:
a.What is the cost per equivalent unit?
b.What are the costs assigned to completed units?
c.What are the costs transferred out?
d.What are the amounts allocated to the work-in-process ending inventory?

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Definitions:

Gross Margin

A company's total sales revenue minus its cost of goods sold, indicating the financial health and profitability of a product or business.

Direct Labor

Workers or employees who are directly involved in the production of goods or services.

Percentage Markup

The increase in cost price expressed as a percentage of the cost.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including materials and labor.