Builder Products, Inc., manufactures a caulking compound that goes through three

Question

Builder Products, Inc., manufactures a caulking compound that goes through three processing stages prior to completion. Information on work in the first department, Cooking, is given below for May:

Compute the costs per equivalent unit for the month. (Round your answers to 2 decimal places.)

Determine the cost of ending work in process inventory and of the units transferred out to the next department. (Round your intermediate calculation to 2 decimal places.)

Prepare a cost reconciliation report for the month.

Builder Products, Inc., manufactures a caulking compound that goes through three processing stages prior to completion. Information on work in the first department, Cooking, is given below for May:

Explanation / Answer

Calculation of pounds Completed and transferred = Opening WIP + (introduced - Closing WIP)

= 10000 + (400000 - 35000)

= 375000 pounds

Calculation of Equivalent Units MATERIAL CONVERSION Opening Units 75000 75000 Introduced & completed during the month 365000 365000 Closing Units 26250 8750 Total Equivalent Units 466250 448750 Calculation of cost per equivalent unit MATERIAL CONVERSION    TOTAL Opening Cost 102300 45600 Cost Incurred during the month 531800 250575 Cost to be accounted for 634100 296175 Total Equivalent Units 466250 448750 Unit Cost 1.36 0.66 2.02 Cost of Closing WIP 35700 5775 41475 Cost of Units Transferred 510000 247500 757500

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