5/1 Balance 3,890 5/31 Transferred out ? 5/31 Materials 6,960 5/31 Labor 4,550 5

Question

5/1 Balance 3,890 5/31 Transferred out ? 5/31 Materials 6,960 5/31 Labor 4,550 5/31 Overhead 1,880 5/31 Balance ? Production records show that there were 600 units in the beginning inventory, 30% complete, 1,800 units started, and 1,600 units transferred out. The beginning work in process had materials cost of $ 2,640 and conversion costs of $ 1,250. The units in ending inventory were 40% complete. Materials are entered at the beginning of the painting process.

What is the cost of the May 31 inventory?

Work in process

Explanation / Answer

Units in process at May 31 = 600+1800-1600 = 800 units Equivalent units for materials = 1600+800 = 2400 Unit materials cost for May = (2640+6960)/2400= $4 Equivalent units for conversion = 1600+(800*40%) = 1920 Unit materials cost for May = (1250+4550+1880)/1920= $4 Cost of the May 31 work in process inventory = (800*4)+(800*40%*4)= $4480

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