The Blending Department of Luongo Company has the following cost and production

Question

The Blending Department of Luongo Company has the following cost and production data for the month of April.
Costs:    Work in process, April 1       Direct materials: 100% complete $101,000       Conversion costs: 20% complete 70,700          Cost of work in process, April 1 $171,700    Costs incurred during production in April       Direct materials $808,000       Conversion costs 368,650          Costs incurred in April $1,176,650
Units transferred out totaled 17,170. Ending work in process was 1,010 units that are 100% complete as to materials and 40% complete as to conversion costs.

Explanation / Answer

Equivalent unit of material = 17170+(1010*100%) = 18180

Equivalent unit of conversion = 17170+(1010*40%) = 17574

Cost per equivalent unit of material = (101000+808000)/18180 = 50

Cost per equivalent unit of conversion = (70700+368650)/17574 = 25

A) transferred out = (50+25)*17170 = $1287750

Ending work in process = (1010*50+404*25) = $60600

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