Question

Helix Corporation uses the weighted-average method in its process costing system. It produces prefabricated flooring in a series of steps carried out in production departments. All of the material that is used in the first production department is added at the beginning of processing in that department. Data for May for the first production department follow:

		Percent Complete
	Units	Materials			Conversion
Work in process inventory, May 1	68,000	100	%		30	%
Work in process inventory, May 31	48,000	100	%		20	%
Materials cost in work in process inventory, May 1				$	55,000
Conversion cost in work in process inventory, May 1				$	16,100
Units started into production					258,800
Units transferred to the next production department					278,800
Materials cost added during May				$	108,400
Conversion cost added during May				$	231,924

Required:

1. Calculate the first production department's equivalent units of production for materials and conversion for May.

2. Compute the first production department's cost per equivalent unit for materials and conversion for May.

3. Compute the first production department's cost of ending work in process inventory for materials, conversion, and in total for May.

4. Compute the first production department's cost of the units transferred to the next production department for materials, conversion, and in total for May.

Answer 1

• Requirement [1]

	Material	Conversion
Equivalent units of production	326,800	288,400

EUP - Weighted Average Method	Units	% Material	EUP Materials	% Conversion	EUP - Conversion
Units TRANSFERRED	278,800	100%	278,800	100%	278,800
Units of ENDING WIP	48,000	100%	48,000	20%	9,600
Equivalent Units of Production			326,800		288,400

• Requirement 2

	Material	Conversion
Cost per Equivalent units	$                         0.50	$                              0.86

COST per EUP			Material		Conversion
Cost of Beginning WIP			$          55,000.00		$                                  16,100.00
Cost incurred during the period			$        108,400.00		$                                231,924.00
Total Costs		Costs	$        163,400.00	Costs	$                                248,024.00
Equivalent units of production		EUP	326,800	EUP	288,400
Cost per EUP			$              0.50000		$                                      0.86000

• Requirement 3

	Material	Conversion	Total
Cost of ending WIP Inventory	$               24,000.00	$                      8,256.00	$                       32,256.00

Cost of ending WIP	EUP	Cost per EUP	Total Cost
- Direct Materials	48,000	$                      0.50	$          24,000.00
- Conversion	9,600	$                      0.86	$             8,256.00
Total cost of ending WIP				$              32,256.00

• Requirement 4

	Material	Conversion	Total
Cost of units completed & transferred out	$            139,400.00	$                 239,768.00	$                     379,168.00

Cost of Units Transferred Out	EUP	Cost per EUP	Total Cost
- Direct Materials	278,800	$                      0.50	$        139,400.00
- Conversion	278,800	$                      0.86	$        239,768.00
Total Cost transferred Out				$            379,168.00