Question

Kitty Inc. processes fish for various cat food distributors. Two departments are involved Department 1 and Department 2. Data relating to kilograms of Cat Food processed in Department 1 during July are presented below:

WIP, May 1st	20,000	30%
Started into process during May	380,000	-
WIP, May 31st	25,000	60%

All materials are added at the beginning of processing in Department 1. Labour and overhead (conversion) costs are incurred uniformly throughout processing.

Required:

1. Prepare quantity schedules and a computation of equivalent units for July for Department 1 according to the weighted average cost method of accounting for units.

Answer 1

Answer:

	Whole units	Equivalent units-Material	Equivalent units-Conversion cost
Units to account for during production
Beginning work in progress	20,000
Started in process	380,000
Total units to be accounted for	400,000
Units to be assigned costs
Completed and transferred	375,000	375,000	375,000
Ending work in progress	25,000	25,000	15,000
Total units to be assigned costs	400,000	400,000	390,000

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