The inventory at April 1, 2012, and the costs charged to Work in Process-Departm

Question

The inventory at April 1, 2012, and the costs charged to Work in Process-Department B during April for Parley Company are as follows: During April, all direct materials are transferred from Department A, the units in process at April 1 were completed, and of the 26,000 units entering the department, all were completed except 1,000 units which were 70% completed as to conversion costs. Inventories are costed by the first-in, first-out me Determine the following, presenting your computations: units completed in the current period equivalent units of production for direct material and conversion cost conversion cost per equivalent unit and material cost per equivalent unit. total cost assigned to the units completed in the current period total cost of work in process inventory at June 30 Show the T-account for work in process account

Explanation / Answer

a Opening Work In Process 1200 Units

Units Transfered in the period 26,000 Units

Total Units available for Production 27200 Units

Closing Work in Process 1000 Units

Units completed 26200 Units

b Equivalent Units of Production=

Total Conversion Cost= 4,88,770

Equivalent Units = 26,420

Conversion cost per equivalent units= $18.5

Total Material Cost =$845000

Equivalent Units = 26000

Total Material cost per equivalent units= $32.5

Total Cost for Units completed= (26000*32.5)+(26420*18.5)

=845000+488770

=13,33,770

e Total cost of work in process inventory= (1000*32.5)+(1000*70%)*18.5

=32500+12950

=$45450

f

T Account

Total Units Equivalent Units(Material Equivalent Units Conversion Cost Opening Inventory 1200 0 720 Completed and Transfered 25000 25000 25000 Closing Inventory 1000 1000 700 Total Units 27200 26000 26420

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