Question

Lansing, Inc. provides the following information for one of its department’s operations for June (no new material is added in Department T):

WIP inventory—Department T Beginning inventory ((8,000 units, 20% complete with respect to Department T costs)

Transferred-in costs (from Department S) $ 33,350

Department T conversion costs 9,020

Current work (18,500 units started)

Prior department costs 83,250

Department T costs 168,480

The ending inventory has 3,000 units, which are 50 percent complete with respect to Department T costs and 100 percent complete for prior department costs.

Required: a. Complete the production cost report using the weighted-average method. (Round "Cost per equivalent unit" to 2 decimal places.)

Answer 1

		Units
Reconciliation of Units
A	Opening WIP	8,000
B	Introduced	18,500
C=A+B	TOTAL	26,500
D	Transferred	23,500
E=C-D	Closing WIP	3,000

Statement of Equivalent Units
		Prior Department cost		Department T
	Units	Complete %	Equivalent units	Complete %	Equivalent units
Transferred	23,500	100%	23,500	100%	23,500
Closing WIP	3,000	100%	3,000	50%	1,500
Total	26,500	Total	26,500	Total	25,000

Cost per Equivalent Units
COST	Prior Department cost	Department T	TOTAL
Beginning WIP Inventory Cost	$       33,350	$        9,020	$        42,370
Cost incurred during period	$       83,250	$   168,480	$     251,730
Total Cost to be accounted for	$     116,600	$   177,500	$     294,100
Total Equivalent Units	26,500	25,000
Cost per Equivalent Units	$ 4.40	$ 7.10

Statement of cost
Cost	Equivalent Cost/unit	Ending WIP		Transferred
		Units	Cost Allocated	Units	Cost Allocated
Prior Department cost	$      4.40	3,000	$     13,200.00	23,500	$ 103,400.00
Department T	$      7.10	1,500	$     10,650.00	23,500	$ 166,850.00
		TOTAL	$           23,850	TOTAL	$        270,250

Reconciliation and Cost report
Cost to be accounted for
Beginning Work In Progress:
Prior Department cost	$    33,350.00
Department T	$      9,020.00	$ 42,370.00
Cost incurred during period:
Prior Department cost	$    83,250.00
Department T	$ 168,480.00	$ 251,730.00
Total Cost to be accounted for				$     294,100.00
Cost accounted for
Cost of Units transferred	Equivalent Units	Cost per Equivalent Units	Cost accounted for
Prior Department cost	23,500	$            4.40	$   103,400.00
Department T	23,500	$            7.10	$   166,850.00
				$     270,250.00
Cost of ending WIP	Equivalent Units	Cost per Equivalent Units	Cost accounted for
Prior Department cost	3,000	$            4.40	$     13,200.00
Department T	1,500	$            7.10	$     10,650.00
				$       23,850.00
Total Cost accounted for				$     294,100.00

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