Question

Talamoto Co. manufactures a single product that goes through two processes — mixing and cooking. The following data pertains to the Mixing Department for September.

Work-in-process Inventory Sept. 1		29,000	units
Conversion complete		70	%
Work-in-process inventory Sept. 30		15,000	units
Conversion complete		50	%
Units started into production in Sept.		69,000
Units completed and transferred out		?	units
Costs
Work-in-process inventory Sept.1
Material P	$	116,000
Material Q		106,000
Conversion		116,000
Costs added in September
Material P	$	174,000
Material Q		159,000
Conversion		342,100

Material P is added at the beginning of work in the Mixing Department. Material Q is also added in the Mixing Department, but not until units of product are forty percent completed with regard to conversion. Conversion costs are incurred uniformly during the process.

The cost of goods completed and transferred out under the weighted-average method is calculated to be:

• $1,013,100.

• $890,187.

• $788,587.

• $864,587.

• $819,587.

Answer 1

Work in Process, Beginning	29000
Add: Units started during Sept	69000
Less: Ending inventory	-15000
Units completed and transferred out	83000
	Material P	Material Q	Conversion
Units completed and transferred out	83000	83000	83000
Work-in-process inventory Sept. 30	15000	15000	7500
Equivalent units of production	98000	98000	90500
	Material P	Material Q	Conversion
Work in process, September 1	116000	106000	116000
Cost added during September	174000	159000	342100
Total costs	290000	265000	458100
Divide by Equivalent units of production	98000	98000	90500
Cost per Equivalent unit	2.959	2.704	5.062
	Material P	Material Q	Conversion	Total
Units completed and transferred out	83000	83000	83000
X Cost per Equivalent unit	2.959	2.704	5.062
Cost of Units completed and transferred out	245612	224439	420136	890187
Option B $890,587 is correct