Question

Superior Micro Products uses the weighted-average method in its process costing system. During January, the Delta Assembly Department completed its processing of 25,200 units and transferred them to the next department. The cost of beginning work in process inventory and the costs added during January amounted to $671,100 in total. The ending work in process inventory in January consisted of 3,000 units, which were 60% complete with respect to materials and 40% complete with respect to labor and overhead. The costs per equivalent unit for the month were as follows: Materials Labor Overhead Cost per equivalent unit $ 14.10 $ 3.40 $ 7.60 Required: 1. Compute the equivalent units of materials, labor, and overhead in the ending work in process inventory for the month. 2. Compute the cost of ending work in process inventory for materials, labor, overhead, and in total for January. 3. Compute the cost of the units transferred to the next department for materials, labor, overhead, and in total for January. 4. Prepare a cost reconciliation for January. (Note: You will not be able to break the cost to be accounted for into the cost of beginning work in process inventory and costs added during the month.)

Answer 1

	Superior Micro Products
	Production Cost Report (Extracts)
	For the month ended January
Answer No.		Actual Units	Equivalent Units
			Material	Labor	Overhead
	Units Completed and Transferred	25200	25200	25200	25200
	Units in ending inventory	3000	1800	1200	1200
1)	Equivalent units of production	28200	27000	26400	26400
		Material	Labor	Overhead	Total
Given	Cost per equivalent unit	14.10	3.40	7.60	25.10
		Total
2)	Units in ending inventory	38,580	(see below note)
3)	Units completed and transfer	632,520	(see below note)
		Material	Labor	Overhead	Total
	Cost Accounted for
	Units completed and transfer	355,320	85,680	191,520	632,520
	Units in ending inventory	25,380	4,080	9,120	38,580
	Total Cost Accounted for	380,700	89,760	200,640	671,100
4)	Cost reconciliation
	Total cost to be accounted for	671,100	(See above note)
	Cost Accounted for
	Units completed and transfer	632,520
	Units in ending inventory	38,580
	Total Cost Accounted for	671,100