During April, the production department of a process manufacturing system comple

Question

During April, the production department of a process manufacturing system completed a number of units of a product and transferred them to finished goods. Of these transferred units, 66,000 were in process in the production department at the beginning of April and 264,000 were started and completed in April. April's beginning inventory units were 65% complete with respect to materials and 35% complete with respect to conversion. At the end of April, 88,000 additional units were in process in the production department and were 80% complete with respect to materials and 30% complete with respect to conversion.

Exercise 3-9 Weighted average: Costs assigned to output and inventories LO C2

The production department had $918,775 of direct materials and $723,261 of conversion costs charged to it during April. Also, its beginning inventory of $185,284 consists of $142,285 of direct materials cost and $42,999 of conversion costs.

1&2. Using the weighted-average method, compute the direct materials cost and the conversion cost per equivalent unit and assign April's costs to the department’s output.

Explanation / Answer

Equivalent units of production (EUP)­ weighted average method Units % Materials EUP­ Materials % Conversion EUP­ Conversion Units completed and transferred out 330000 100% 330000 100% 330000 Ending goods in process ­ units 88000 80% 70400 30% 26400 Total units 418000 400400 356400 Cost per equivalent unit of production Materials Conversion Costs of beginning work in process 142285 42999 Costs incurred this period 918775 723261 Total costs 1061060 766260 ÷ Equivalent units of production 400400 356400 Cost per equivalent unit of production 2.65 2.15 Total costs accounted for: EUP Cost per EUP Total cost Cost of units transferred out: Direct materials 330000 2.65 874500 Conversion 330000 2.15 709500 Total costs transferred out 1584000 Costs of ending goods in process: EUP Cost per EUP Total cost Direct materials 70400 2.65 186560 Conversion 26400 2.15 56760 Total cost of ending goods in process 243320 Total costs accounted for 1827320

Related Questions

Navigate

• Browse (All)
• Browse D
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.