Question

Suburbia Company manufactures a product through a continuous single-step process. All materials are added at the beginning of processing. Production and cost data for the company for February 2016 are as follows:

Production data:
In process, beginning of month (20% converted)	1,000 units
Started during February	5,000 units
Completed and transferred to finished goods	4,500 units
In process, end of month (60% converted)	1,500 units
Manufacturing costs:
Work in process, beginning (Materials $3,000; Conversion Costs: $18,360)	$21,360
Materials	$45,000
Direct labor cost	$102,960
Applied Factory overhead cost	$51,480

Required:
Calculate the Following using the weighted average method:

Equivalent Units of Production for Direct materials	(Do not enter commas in answer for example 5,000 should be entered as 5000)
Equivalent Units of Production for Conversion Costs	(Do not enter commas in answer for example 5,000 should be entered as 5000)
Cost per Equivalent Unit – Direct Materials	(Round to 2 decimal places)
Cost per Equivalent Unit – Conversion Costs	(Round to 2 decimal places)
Total value of units transferred out	(Round to the nearest whole dollar and do not enter dollar signs or commas in answer for example $5,000 should be entered as 5000)
Total value of Ending Inventory	(Round to the nearest whole dollar and do not enter dollar signs or commas in answer for example $5,000 should be entered as 5000)

Answer 1

Equivalent units
			units	%	materials	%	CC
completed & Transferred			4,500	100%	4,500	100%	4,500
ending work in process			1,500	100%	1,500	60%	900
Equivalent units			6,000		6,000		5,400
cost per Equivalent units
					materials	CC	total
beginning work in proces					3,000	18,360	21,360
cost added during the year					45,000	154440	199,440
total cost					48,000	172,800	220,800
equivalent units					6,000	5,400
cost per Equivalent units					8	32	40
cost of units tranferred out
	4,500*40=				180000
cost of ending WIP
	materials	1,500*8		12000
	CC	900*32		28800	40800
					220800
Equivalent Units of Production for Direct materials	6,000
Equivalent Units of Production for Conversion Costs	5,400
Cost per Equivalent Unit – Direct Materials	8
Cost per Equivalent Unit – Conversion Costs	$32
Total value of units transferred out	$180,000
Total value of Ending Inventory	$28,800