The Fields Company has two manufacturing departments, forming and painting. The

Question

The Fields Company has two manufacturing departments, forming and painting. The company uses the weighted-average method of process costing. At the beginning of the month, the forming department has 30,000 units in inventory, 65% complete as to materials and 35% complete as to conversion costs. The beginning inventory cost of $61,000 consisted of $45,000 of direct materials costs and $16,000 of conversion costs.

During the month, the forming department started 300,000 units. At the end of the month, the forming department had 35,000 units in ending inventory, 90% complete as to materials and 20% complete as to conversion. Units completed in the forming department are transferred to the painting department.

Cost information for the forming department is as follows:

Beginning work in process inventory $ 61,100 Direct materials added during the month 1,261,000 Conversion added during the month 890,000

1. Calculate the equivalent units of production for the forming department. Direct Materials Conversion 2. Calculate the costs per equivalent unit of production for the forming department. (Round your answer to 2 decimal places.) Direct Materials EUP EUP Conversion

Explanation / Answer

Beginning work in process 30,000 Completed & Transferred 295,000 started during the year 300,000 Ending work in process 35,000 units to be accounted 330,000 units accounted for 330,000 1) Equivalent units units % mater materials % CC conversion completed & Transferred 295,000 100% 295,000 100% 295,000 Ending work in process 35,000 90% 31500 20% 7000 Equivalent units 330,000 326,500 302,000 Direct materials 326,500 Conversion 302,000 2) cost per Equivalent units of production Materials CC Total Beginning work in process 45,000 16,000 61,000 cost added during the year 1,261,000 890,000 2,151,000 total cost 1,306,000 906,000 2,212,000 Equivalent units 326,500 302,000 cost per unit 4 3 7 Direct materials 4 per EUP Conversion 3 per EUP 3) Cost Assignment and Reconciliation Cost of units transferred out EUP cost per EUP Total cost Direct Materials 295,000 4 1180000 Conversion 295,000 3 885000 total costs transferred out          2,065,000 costs of ending work in process Direct Materials 31500 4 126000 Conversion 7000 3 21000 total cost of ending work in process             147,000 total costs assigned          2,212,000

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