Question

Note: This is one question. Please answer completely.

Superior Micro Products uses the weighted-average method in its process costing system. During January, the Delta Assembly Department completed its processing of 25,400 units and transferred them to the next department. The cost of beginning work in process inventory and the costs added during January amounted to $669,528 in total. The ending work in process inventory in January consisted of 3,200 units, which were 80% complete with respect to materials and 60% complete with respect to labor and overhead. The costs per equivalent unit for the month were as follows:

	Materials			Labor			Overhead
Cost per equivalent unit	$	13.10		$	4.30		$	6.80

Required:

1. Compute the equivalent units of materials, labor, and overhead in the ending work in process inventory for the month.

2. Compute the cost of ending work in process inventory for materials, labor, overhead, and in total for January.

3. Compute the cost of the units transferred to the next department for materials, labor, overhead, and in total for January.

4. Prepare a cost reconciliation for January. (Note: You will not be able to break the cost to be accounted for into the cost of beginning work in process inventory and costs added during the month.)

Answer 1

Solution

	Material	Labor	Overhead
Equivalent units	27,960	27,320	27,320

.

	Transferred In	Material	Conversion cost	Total
Cost of ending work in process	$         33,536.00	$          8,256.00	$       13,056.00	$       54,848.00

.

	Transferred In	Material	Conversion cost	Total
Cost of Units Completed and transferred out	$       332,740.00	$      109,220.00	$     172,720.00	$     614,680.00

.

Cost reconciliation
Total cost to be accounted for	$       669,528.00
Costs accounted for as follows
Cost of ending work in process	$         54,848.00
Cost of Units Completed and transferred out	$       614,680.00
Total costs accounted for	$       669,528.00

Working

Statement of Equivalent Units(Weighted average)
		Transferred In		Material		Conversion cost
	Units			Complete %	Equivalent units	Complete %	Equivalent units
Transferred	25,400	100%	25,400.0	100%	25,400.0	100%	25,400
Ending WIP	3,200	80%	2,560.0	60%	1,920.0	60%	1,920
Total	28,600		27,960	Total	27,320.0	Total	27,320

.

Statement of cost (Weighted average)
Cost	Equivalent Cost/unit	Ending WIP		Transferred
		Units	Cost Allocated	Units	Cost Allocated
Transferred In	$                 13.10	2,560	$       33,536.00	25,400	$ 332,740
Material	$                    4.30	1,920	$         8,256.00	25,400	$ 109,220
Conversion cost	$                    6.80	1,920	$       13,056.00	25,400	$ 172,720
		TOTAL	$ 54,848	TOTAL	$ 614,680