Pacific Ink had beginning work-in-process inventory of $760000 on October 1. Of
ID: 2576367 • Letter: P
Question
Pacific Ink had beginning work-in-process inventory of $760000 on October 1. Of this amount, $305,920 was the cost of direct materials and $454,080 was the cost of conversion.The 49,000 units in the beginning inventory were 30 percent complete with respect to both direct materials and conversion costs
During October, 104,000 units were transferred out and 31,000 remained in ending inventory.The units in ending inventory were 80 percent complete with respect to direct materials and 40 percent complete with respect to conversion costs. Costs incurred during the period amounted to $2,282,000 for direct materials and $3,101,850 for conversion
a. Compute the equivalent units for conversion cost calculations using the weighted average method.
b. Compute the cost per equivalent unit for direct materials using the weighted-average method
Pacific Ink had beginning work-in-process inventory of $760000 on October 1. Of this amount, $305,920 was the cost of direct materials and $454,080 was the cost of conversion.The 49,000 units in the beginning inventory were 30 percent complete with respect to both direct materials and conversion costs
Explanation / Answer
Equivalent units material conversion units tranfered out 104000 104000 ending WIP (31000 * 80%) 24800 ending WIP (31000 *40%) 12400 Equivqlent units(b) 128800 116400 cost per Equivalent units material conversion Cost of Beginning WIP 305920 454080 cost during the period 2282000 3101850 total cost (a) 2587920 3555930 cost per Equivqlent units(a/b) 20.09254658 30.5492268
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