In: Accounting
Conlon Chemicals manufactures paint thinner. Information on the work in process follows:
• Beginning inventory, 42,700 partially complete gallons.
• Transferred out, 210,000 gallons.
• Ending inventory (materials are 19 percent complete; conversion costs are 10 percent complete).
• Started this month, 244,100 gallons.
Required:
a. Compute the equivalent units for materials using the weighted-average method.
Equivalent units (Gallons)
b. Compute the equivalent units for conversion costs using the weighted-average method.
Equivalent units (Gallons)
Materials | Conversion Costs | |
Units transferred out | 2,10,000 | 2,10,000 |
Equivalent units in ending inventory: | ||
Materials:19% × 76,800 units | 14,592 | |
Conversion costs: 10% × 76,800 units | 7680 | |
Total equivalent units for all work done to date | 2,24,592 | 2,17,680 |
Computation of Ending Inventory | |
Beginning Inventory | 42,700 |
Unit Started | 2,44,100 |
Less: Unit Trf Out | -2,10,000 |
Ending Inventory | 76,800 |