Weighted average: Cost per equivalent unit; costs assigned to products Victory C

Question

Weighted average: Cost per equivalent unit; costs assigned to products

Victory Company uses weighted-average process costing to account for its production costs. Direct labor is added evenly throughout the process. Direct materials are added at the beginning of the process. During November, the company transferred 755,000 units of product to finished goods. At the end of November, the goods in process inventory consists of 199,000 units that are 60% complete with respect to labor. Beginning inventory had $434,070 of direct materials and $174,880 of direct labor cost. The direct material cost added in November is $2,904,930, and the direct labor cost added is $3,322,720.

Explanation / Answer

Materials Labor Total Costs (WIP Opening + Additions) $ 3339000 $ 3497600 Equivalent Units of Production EUP EUP Units transferred to FG 755000 755000 Closing Inventory Units 119400 874400 Cost per equivalent unit of production $ 4.42 $ 4.00 Equivalent Units of Production with respect to direct labor and raw materials Units % Mat EUP Mat % Labor Eup Labor Units transferred to FG 755000 100 755000 100 755000 Closing Inventory Units 199000 0 0 60 119400 Total Units 954000 755000 874400 EUP Cost per EUP Total Cost $ $ Cost of Units trfd out Direct Materials 755000 4.42 3339000 Direct Labor 755000 4.00 3020000 Total Costs trfd out 6359000 Cost of Ending Goods in Process Direct Materials 0 0 0 Direct Labor 119400 4.00 477600 Total Costs of Ending Goods in Process 477600 Total Costs trfd out 6836600

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