Question

The Matsui Lubricants plant uses the weighted-average method to account for its work-in-process inventories. The accounting records show the following information for a particular day.

Beginning WIP inventory
Direct materials	$	992
Conversion costs		407
Current period costs
Direct materials		18,540
Conversion costs		10,538

Quantity information is obtained from the manufacturing records and includes the following.

Beginning inventory	900	units	(60% complete as to materials, 55% complete as to conversion)
Current period units started	4,900	units
Ending inventory	1,100	units	(40% complete as to materials, 25% complete as to conversion)

Compute the cost of goods transferred out and the ending inventory using the weighted-average method. (Do not round intermediate calculations.)

Answer 1

1	Cost of goods transfer out = Number of unit * Total equivalent cost
	Number of unit = 4700	(900+4900-1100))
	Total equivalent unit cost = $6	(4+2)
	Cost of goods transfer out = 4700 *6
	Cost of goods transfer out =	$ 28,200
2	Cost of ending inventory
	Direct material ( 440 *4)	$                       1,760
	Conversion cost (275*2)	$                           550
	Total cost	$                       2,310
	Total equivalent unit cost
		Direct material	Conversion cost
	Cost f beginning inventory	$                           992	$                              407
	Cost incurred during the period	$                     18,540	$                        10,538
	Total cost	$                     19,532	$                        10,945
	No. of equivalent units	5140	4975
	Total equivalent unit cost	$                                4	$                                   2
	No. of equivalent units
		Direct material	Conversion cost
	Unit completed and transfer	4700	4700
		(4700*100%)	(4700*100%)
	Unit ending inventory	440	275
		(1100*40%)	(1100*25%)
	Equivalent units	5140	4975