Heller Corporation uses the weighted-average method in its process costing syste
ID: 2490412 • Letter: H
Question
Heller Corporation uses the weighted-average method in its process costing system. Data concerning the first processing department for the most recent month are listed below:
Note: Your answers may differ from those offered below due to rounding error. In all cases, select the answer that is the closest to the answer you computed.
The total cost transferred from the first processing department to the next processing department during the month is closest to: (Round your cost per equivalent unit answers to 2 decimal places.)
Heller Corporation uses the weighted-average method in its process costing system. Data concerning the first processing department for the most recent month are listed below:
Explanation / Answer
Answer:
Calculation of Equivalent Units :
Equivalent Units = Units transferred + (Units in ending WIP inventory * % of completion)
Materials:
Equivalent Units for materials = 8800 units + (1900 units *60%)
= 8800 units + 1140 units
= 9940 units
Conversion:
Equivalent units for conversion = 8800 units + (1900 units *25%)
= 8800 units + 475 units
= 9275 units
Calculation of total cost:
Total cost = Cost in beginning + Costs added during the month
Materials:
Total cost for materials = $4300+ $122932 = $127232
Conversion:
Total cost for conversion = $2300 + $175780 = $178080
Calculation of cost per equivalent unit:
Cost per equivalent unit = Total cost / Equivalent units
Materials:
Cost per equivalent unit for material = $127232/9940 units = $12.80 per equivalent unit
Conversion:
Cost per equivalent unit for conversion = $178080/9275 units =$19.20 per equivalent unit
Calculation of total cost transferred to the next processing department:
Therefore, total cost transferred from the first processing department to the next processing department during the month is closest to $281600.
Material Conversion Total Units transferred to the next department (a) 8800 8800 Cost per equivalent unit (b) 12.8 19.2 Cost transferred to the next department (a) * (b) 112640 168960 281600Related Questions
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