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

Question

Harmon Company uses the weighted-average method in its process costing system. The Curing Department of Harmon Company reported the following information for the month of November.
Units % Complete w/respect to Conversion
Work in process, Nov 1....... 10000 80%
Units Started................... 28000
Completed and transf. out... 30000
Work in process, Nov. 30.... 8000 30%

Costs for Novermber: Materials Conversion
work in process, Nov 1.... 34500 48600
Added during the month... 146000 194400


All materials are added at the beginning of the process.
Required:
Compute the following items using the weighted-average method:
a. The equivalent units of production for materials.
b. The cost per equivalent unit for conversion.
c. The total cost assigned to units transferred out of the Curing Department during November.
d. The cost assigned to work in process inventory as of November 30.

Explanation / Answer

                                             Physical      Equivalent units
                                                units        Mater.     Conver.
Beginning WIP Inventory            10,000
Units started into production     28,000
Units to account for                  38,000
Transfered to next dept.           30,000       30,000     30,000
Ending WIP Inventory    30%       8,000         8,000       2,400
Total Weighted average units                     38,000     32,400

a. The equivalent units of production for materials. 38,000 units

b. The cost per equivalent unit for conversion.
     Total Conversion Cost   $48,600+$194,400           $243,000
     Cost per equivalent unit $243,000 / 32,400         $7.50

c. The total cost assigned to units transferred out of the Curing Department during November
    
Materials ($34,500 + $146,000) x 30,000/38,000     $142,500
Conversion 30,000 x $7.50                                    $225,000
Total cost                                                            $367,500

d. The cost assigned to work in process inventory as of November 30.
  Materials ($34,500 + $146,000) x 8,000/38,000       $38,000
Conversion 2,400 x $7.50                                       $18,000
Total cost                                                             $56,000
    

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