Question

Builder Products, Inc., uses the weighted-average method in its process costing system. It manufactures a caulking compound that goes through three processing stages prior to completion. Information on work in the first department, Cooking, is given below for May:

Production data:
Pounds in process, May 1; materials 100% complete; conversion 90% complete		89,000
Pounds started into production during May		540,000
Pounds completed and transferred out		?
Pounds in process, May 31; materials 80% complete; conversion 20% complete		60,000
Cost data:
Work in process inventory, May 1:
Materials cost	$	124,400
Conversion cost	$	61,700
Cost added during May:
Materials cost	$	646,850
Conversion cost	$	339,190

Required:

1. Compute the equivalent units of production for materials and conversion for May.

2. Compute the cost per equivalent unit for materials and conversion for May.

3. Compute the cost of ending work in process inventory for materials, conversion, and in total for May.

4. Compute the cost of units transferred out to the next department for materials, conversion, and in total for May.

5. Prepare a cost reconciliation report for May.

Answer 1

Solution 1:
Builder Products Inc
Equivalent units of production (EUP) for the month of May - Weighted Average method
	Units	% material	EUP-Materials	% Conversion	EUP- Conversion
Units Completed and transferred out (89000+540000-60000)	569000	100%	569000	100%	569000
units of Ending work in process	60000	80%	48000	20%	12000
Equivalent units of production	629000		617000		581000
Solution 2:
Cost per Equivalent unit:	Material	Conversion
Cost of Beginning Work in Process	$124,400	$61,700
Cost added during the month	$646,850	$339,190
Total Costs	$771,250	$400,890
/Equivalent units of Production	617000	581000
Cost per Equivalent unit of Production	$1.25	$0.69
Solution 3:
Cost of ending work in process	EUP	Cost per EUP	Total Cost
Material	48000	$1.25	$60,000.00
Conversion	12000	$0.69	$8,280.00
Total Ending work in process			$68,280.00
Solution 4:
Cost of Units Transferred Out	EUP	Cost per EUP	Total Cost
Material	569000	$1.25	$711,250.00
Conversion	569000	$0.69	$392,610.00
Total transferred out			$1,103,860.00

Solution 5:
Cost reconciliation Report
Beginning work in process May 1 [124400+61700]	$186,100.00
current period cost [646850+339190]	$986,040.00
Total cost to account for	$1,172,140.00
Cost accounted for
cost of units completed and transferred out	$1,103,860.00
Cost of ending work in process	$68,280.00
Total cost accounted for	$1,172,140.00