Question

The Blending Department of Oriole Company has the following cost and production data for the month of April. Costs:    Work in process, April 1       Direct materials: 100% complete $113,000       Conversion costs: 20% complete 79,100          Cost of work in process, April 1 $192,100    Costs incurred during production in April       Direct materials $904,000       Conversion costs 412,450          Costs incurred in April $1,316,450 Units transferred out totaled 19,210. Ending work in process was 1,130 units that are 100% complete as to materials and 40% complete as to conversion costs.

Compute the equivalent units of production for (1) materials and (2) conversion costs for the month of April. Materials Conversion Costs The equivalent units of production

Compute the unit costs for the month. Materials Conversion Costs Unit costs $ $

Determine the costs to be assigned to the units transferred out and in ending work in process. Transferred out $ Ending work in process $

Answer 1

Solution

	Material	Conversion
Equivalent Units of Production	20,340	19,662

.

	Material	Conversion
Unit cost	$ 50.00	$ 25.00

.

Transferred out	$                     1,440,750
Work in process	$                           67,800

Working

Statement of Equivalent Units(Weighted average)
				Material		Conversion
	Units			Complete %	Equivalent units	Complete %	Equivalent units
Transferred out	19,210			100%	19,210	100%	19,210
Ending WIP	1,130			100%	1,130	40%	452
Total	20,340			Total	20,340	Total	19,662

.

Cost per Equivalent Units (Weighted average)
COST		Material	Conversion	TOTAL
Beginning WIP Inventory Cost (A)		$ 113,000	$ 79,100	$ 192,100
Cost incurred during period (B)		$ 904,000	$ 412,450	$ 1,316,450
Total Cost to be accounted for (C=A+B)		$ 1,017,000	$ 491,550	$ 1,508,550
Total Equivalent Units(D)		20,340	19,662
Cost per Equivalent Units (E=C/D)		$                 50.00	$                   25.00	$                     75.00

.

Statement of cost (Weighted average)
Cost	Equivalent Cost/unit	Ending WIP		Transferred
		Units	Cost Allocated	Units	Cost Allocated
Material	$ 50.00	1,130	$          56,500.00	19,210	$        960,500.00
Conversion	$ 25.00	452	$          11,300.00	19,210	$        480,250.00
TOTAL	$ 1,508,550	TOTAL	$ 67,800	TOTAL	$ 1,440,750