The WireOne Company manufactures high-quality coated electrical wire in two depa
ID: 2491952 • Letter: T
Question
The WireOne Company manufactures high-quality coated electrical wire in two departments, Weaving and Coating. Materials are introduced at various points during work in the Weaving Department. After the weaving is completed, the materials are transferred into the Coating Department, where specialty plastic coating is applied.
Compute the costs per equivalent unit for May. (Round your answers to 2 decimal places.)
Determine the cost of ending work in process inventory and of the units transferred to the Coating Department. (Round intermediate calculations to 2 decimal places, and final answers to the nearest whole dollar.)
Prepare a cost reconciliation between the costs determined in (3) above and the cost of beginning inventory and costs added during the period. (Round intermediate calculations to 2 decimal places, and final answers to the nearest whole dollar.)
Selected data relating to the Weaving Department during May are given below:Explanation / Answer
Opening work in process on May 1 109000 kgs (+) Production started during May 461000 kgs (-) Closing work in process May 31 72000 kgs Completed and transferred to Coating 498000 kgs Answer 1 Calculation of Equivalent units of production Total Units % of completion with respect to material Equivalent units of production % of completion with respect to Conversion Equivalent units of production Kilograms transferred to Coating 498000 100% 498000 100% 498000 Kilograms in ending work in process 72000 65% 46800 30% 21600 Total EUP 544800 519600 Answer 2 Calculation of Cost per Equivalent Unit Direct Materal Conversion Opening Work in process $1,06,820 $98,100 Cost added during May $8,68,372 $3,90,324 Total Cost $9,75,192 $4,88,424 Equivalent Units of production 544800 519600 Cost per EUP $1.79 $0.94 Answer 3 Calculation of cost EUP (Material) Rate per unit Material cost EUP (Conversion) Rate per unit Conversion cost Total Cost Ending Work in process 46800 $1.79 $83,772.00 21600 $0.94 $20,304.00 $1,04,076.00 Units transferred to Coating 498000 $1.79 $8,91,420.00 498000 $0.94 $4,68,120.00 $13,59,540.00 Answer 4 Cost reconciliation Cost of Opening work in process on May 1 $2,04,920 (+) Cost added during May $12,58,696 Total Cost $14,63,616 Cost of Production completed and transferred during May $13,59,540 (+) Cost of Closing work in process May 31 $1,04,076 Total Cost $14,63,616
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