Question

Zia Co. makes flowerpots from recycled plastic in two departments, molding and packaging. At the beginning of the month, the molding department has 4,200 units in inventory, 70% complete as to materials. During the month, the molding department started 29,000 units. At the end of the month, the molding department had 6,300 units in ending inventory, 80% complete as to materials. Units completed in the molding department are transferred into the packaging department.
Cost information for the molding department for the month follows:

Beginning work in process inventory (direct materials)	$	3,400
Direct materials added during the month		49,900

Using the weighted-average method, compute the molding department’s (a) equivalent units of production for materials and (b) cost per equivalent unit of production for materials for the month. (Round "cost per equivalent unit of production" to 2 decimal places.)

		direct materials
a	Equivalent Units of production	?
b	Cost per equivalent unit of production	?

Answer 1

Solution

	direct materials
a	Equivalent Units of production	31,940
b	Cost per equivalent unit of production	$ 1.67

Working

Reconciliation of Units
A	Beginning WIP	4,200
B	Introduced	29,000
C=A+B	TOTAL	33,200
D	Transferred out	26,900
E=C-D	Ending WIP	6,300

.

Statement of Equivalent Units(Weighted average)
				Material
	Units			Complete %	Equivalent units
Transferred out	26,900			100%	26,900
Ending WIP	6,300			80%	5,040
Total	33,200			Total	31,940

.

COST		Material
Beginning WIP Inventory Cost		$ 3,400
Cost incurred during period		$ 49,900
Total Cost to be accounted for		$ 53,300
Total Equivalent Units		31,940
Cost per Equivalent Units		$                   1.67