Department J had no work in process at the beginning of the period; 18^000 units

Question

Department J had no work in process at the beginning of the period; 18^000 units were completed during the period; and 2,000 units were 30% completed at the end of the period. I lie following manufacturing costs were debited to the departmental work in process account during the period (Assume the company uses FIFO and rounds cost per unit to two decimal places): Assuming that all direct materials are placed in process at the beginning of production, what is the total cost of the 18,000 units completed during the period? Assuming that all direct materials are placed in process at the beginning of production, what is the total cost of the departmental work in process inventory' at the end of the period?

Explanation / Answer

Solution:

1. Total Unit completed during the period (labor and Overhead)= 18,000 + 2,000 x 30%

Total Unit completed during the period (labor and Overhead)= 18,600

Total Cost Incurred(Labor and Overhead)=142,300 + 57,200

Total cost incurred (labor and overhead) = 199,500

Cost per unit = Total cost incurred/Units completed

Cost per unit = $199,500/18,600

Cost per unit = $10.73

Total cost of 18,000 units = 18,000 x $10.73

Total cost of 18,000 units = $193,140

2. Total cost of departmental WIP = 2000*5 + 600*10.73

Total cost of departmental WIP = $16,438

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