Scheney Company uses the weighted-average method in its process costing system.

Question

Scheney Company uses the weighted-average method in its process costing system. The company's work in process inventory on March 31 consisted of 20,000 units. The units in the ending work in process inventory were 100% complete with respect to materials and 70% complete with respect to labor and overhead. If the cost per equivalent unit for March was $2.50 for materials and $4.75 for labor and overhead, the total cost in the March 31 work in process inventory was:

$145,000

$116,500

$101,500

$78,500

a.

$145,000

b.

$116,500

c.

$101,500

d.

$78,500

Explanation / Answer

$116,500

Working:

b.

$116,500

Working:

a. Equivalent units of Materials and Labor: Materials Conversion Units % Of completion Equivalent units of Production % of completion Equivalent units of Production Ending Work in Process        20,000 100% 20,000 70% 14,000 b. Total Costs in March 31 work in process inventory: Equiavlent units of production Cost per equivalent unit Total Cost Materials 20,000 $ 2.50 $ 50,000 Labor and Overhead 14,000 $ 4.75 $ 66,500 Total $ 1,16,500

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