Bachelet Inc. uses the weighted-average method in its process costing system. Th

Question

Bachelet Inc. uses the weighted-average method in its process costing system. The following data concern the operations of the company’s first processing department for a recent month.

Required:

Using the weighted-average method:

a. Determine the equivalent units of production for materials and conversion costs.

b. Determine the cost per equivalent unit for materials and conversion costs.

c. Determine the cost of units transferred out of the department during the month.

d. Determine the cost of ending work in process inventory in the department.

Work in process, beginning: Units in process 400 Percent complete with respect to materials 90 % Percent complete with respect to conversion 40 % Costs in the beginning inventory: Materials cost $ 756 Conversion cost $ 4,448 Units started into production during the month 13,000 Units completed and transferred out 13,000 Costs added to production during the month: Materials cost $ 29,949 Conversion cost $ 362,127 Work in process, ending: Units in process 100 Percent complete with respect to materials 50 % Percent complete with respect to conversion 30 %

Explanation / Answer

Solution a:

Solution b:

Solution c & d:

Note: It is assumed that units completed and transferred out given in question is not correct as total units accounted for each not matching. Therefore we have assumed that units in ending WIP is correctly given but units completed and transferred out should be = 400 + 13000 - 100 = 13300 units

Computation of Equivalent unit of Production - Weighted Average (First Proessing Department) Particulars Physical Units Material Conversion Unit completed & Transferred out 13300 13300 13300 Closing WIP: 100 Material (50%) 50 Conversion (30%) 30 Equivalent units of production 13400 13350 13330

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