Sabbath Company produces plastic cups in a one- department process. The following information is available: $\begin{array} { l }
\text {Work-in- process inventory, beginning }& 0\
\text { Unitsstarted}& 60,000\
\text {Units complete and transferred out }&48,000 \
\text {Work-in- process inventory,ending }&12,000 \
\text {Direct materials added }& \$240,000\
\text {Direct labor }&\$165,600 \
\text {Factory overhead }&\$82,800 \
\end{array}$
The units still in process are 100% complete with respect to direct materials and 60% complete with respect to conversion costs. The total cost of units completed and transferred is:

Question

Sabbath Company produces plastic cups in a one- department process. The following information is available: $\begin{array} { l  }
 \text {Work-in- process inventory, beginning }& 0\
 \text { Unitsstarted}& 60,000\
 \text {Units complete and transferred out }&48,000 \
 \text {Work-in- process inventory,ending }&12,000 \
 \text {Direct materials added }& \$240,000\
 \text {Direct labor }&\$165,600 \
 \text {Factory overhead }&\$82,800 \
\end{array}$
 The units still in process are 100% complete with respect to direct materials and 60% complete with respect to conversion costs. The total cost of units completed and transferred is:

Quizplus · Accepted Answer

The total cost of units completed and transferred out is calculated by adding the costs of direct materials, direct labor, and factory overhead for the completed units. The direct materials cost is $240,000, and the conversion costs (direct labor + factory overhead) are $165,600 + $82,800 = $248,400. Since 48,000 units were completed and transferred out, the total cost is $240,000 + $248,400 = $488,400. However, the question asks for the cost of units completed and transferred, which is $408,000, considering the proportion of completion for conversion costs.

Sabbath Company Produces Plastic Cups in a One- Department Process