Aaron Company applies the weighted average method. The Molding Department report

Question

Aaron Company applies the weighted average method. The Molding Department reported the following information for March.

                                                                  Units         Percent complete with         Percent complete with

                                                                                    respect to materials             respect to conversion

Work in process, March 1                         12,000                  100%                                     70%

Units started                                              20,000

Units completed and transferred out         30,000

Work in process, March 31                         2,000                   80%                                       75%

Costs for March                                    Materials             Conversion

Work in process, March 1                     $53,000                 $170,000

Added during the month                       $105,000                $208,000                

Compute the total cost assigned to units transferred out by the Molding Department during March.

Explanation / Answer

Direct materials Conversion costs Units completed and transferred out 30000 30000 Work in process, March 31 1600 1500 Equivalent units 31600 31500 Total costs 158000 378000 Cost per Equivalent unit 5 12 Total cost assigned to units transferred out = 30000*(5+12)= $510000

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