Question

Materials costs of $572000 and conversion costs of $736270 were charged to a processing department in the month of September. Materials are added at the beginning of the process, while conversion costs are incurred uniformly throughout the process. There were no units in beginning work in process, 110000 units were started into production in September, and there were 9000 units in ending work in process that were 30% complete at the end of September.

What was the total amount of manufacturing costs assigned to those units that were completed and transferred out of the process in September?

$1242300.

$525200.

$1353000.

$1308270.

Answer 1

Correct answer-------------$1242300.

Working

Reconciliation of Units
A	Beginning WIP	-
B	Introduced	110,000
C=A+B	TOTAL	110,000
D	Transferred out	101,000
E=C-D	Ending WIP	9,000

.

Statement of Equivalent Units(Weighted average)
				Material		Conversion cost
	Units			Complete %	Equivalent units	Complete %	Equivalent units
Transferred out	101,000			100%	101,000	100%	101,000
Ending WIP	9,000			100%	9,000	30%	2,700
Total	110,000			Total	110,000	Total	103,700

.

Cost per Equivalent Units (Weighted average)
COST		Material	Conversion cost	TOTAL
Beginning WIP Inventory Cost				$ 0
Cost incurred during period		$ 572,000	$ 736,270	$ 1,308,270
Total Cost to be accounted for		$ 572,000	$ 736,270	$ 1,308,270
Total Equivalent Units		110,000	103,700
Cost per Equivalent Units		$                   5.20	$                     7.10	$             12.30

.

Statement of cost (Weighted average)
Cost	Equivalent Cost/unit	Ending WIP		Transferred
		Units	Cost Allocated	Units	Cost Allocated
Material	$ 5.20	9,000	$          46,800.00	101,000	$        525,200.00
Conversion cost	$ 7.10	2,700	$          19,170.00	101,000	$        717,100.00
TOTAL	$ 1,308,270	TOTAL	$ 65,970	TOTAL	$ 1,242,300