Timberline Associates uses the weighted-average method in its process costing sy
ID: 2417774 • Letter: T
Question
Timberline Associates uses the weighted-average method in its process costing system. The following data are for the first processing department for a recent month:
Work in process, beginning:
Units in process……………………………………………………………………………….….2400
Stage of completion as to materials…………………………………………….….%75
Stage of completion as to labor and overhead……………………………….%50
Costs in the beginning inventory:
Materials cost……………………………………………………………………………………..8400
Labor cost…………………………………………………………………………………………..6000
Overhead cost……………………………………………………………………………………1200
Units started into production during the month……………………………….…. 20800
Units completed and transferred out…………………………………………………... 22,200
Costs added to production during the month:
Materials cost……………………………………………………………………….…….……...97400
Labor cost………………………………………………………………………….……….………85200
Overhead cost…………………………………………………………………….……….…….44400
Work in process, ending:
Units in process…………………………..................................................1000
Stage of completion as to materials………………………………………….….…80%
Stage of completion as to labor and overhead…………………………..….60
3.Determine the total cost of ending work in process inventory and the total cost of units transferred to the next processing department in June.
Work in process, beginning:
Units in process……………………………………………………………………………….….2400
Stage of completion as to materials…………………………………………….….%75
Stage of completion as to labor and overhead……………………………….%50
Costs in the beginning inventory:
Materials cost……………………………………………………………………………………..8400
Labor cost…………………………………………………………………………………………..6000
Overhead cost……………………………………………………………………………………1200
Units started into production during the month……………………………….…. 20800
Units completed and transferred out…………………………………………………... 22,200
Costs added to production during the month:
Materials cost……………………………………………………………………….…….……...97400
Labor cost………………………………………………………………………….……….………85200
Overhead cost…………………………………………………………………….……….…….44400
Work in process, ending:
Units in process…………………………..................................................1000
Stage of completion as to materials………………………………………….….…80%
Stage of completion as to labor and overhead…………………………..….60
3.Determine the total cost of ending work in process inventory and the total cost of units transferred to the next processing department in June.
Explanation / Answer
Equivalent units:
3a) the total cost of ending work in process inventory = 800 * 4.59 + (3.95 + 2.06) 600 = $7278
3b) the total cost of units transferred to the next processing department in June = Brought forward cost of Opening WIP + Cost of units introduced and completed during the month.
= (8400 + 6000 + 1200) + (4.59 + 3.95 + 2.06) 19800 = $225480
Units Particulars units Material cost Labor cost Overhead cost 2400 Opening Work in Process 2400 600 (25%) 1200 (50%) 1200 (50%) 20800 Unit introduced & completed 19800 19800 (100%) 19800 (100%) 19800 (100%) Units transferred out 22200 Closing Work in Process 1000 800 (80%) 600 (60%) 600 (60%) Equivalent units 21200 21600 21600 Cost during the month 97400 85200 44400 Per equivalent unit cost 4.59 3.95 2.06Related Questions
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