Question

Exercise 3-3 (Video) The ledger of American Company has the following work in process account. Work in Process—Painting 5/1 Balance 3,790 5/31 Transferred out ? 5/31 Materials 7,030 5/31 Labor 5,648 5/31 Overhead 1,580 5/31 Balance ? Production records show that there were 500 units in the beginning inventory, 30% complete, 1,600 units started, and 1,500 units transferred out. The beginning work in process had materials cost of $2,840 and conversion costs of $950. The units in ending inventory were 40% complete. Materials are entered at the beginning of the painting process. How many units are in process at May 31? Work in process, May 31 units LINK TO TEXT LINK TO TEXT LINK TO TEXT What is the unit materials cost for May? (Round unit cost to 2 decimal places, e.g. 2.25.) The unit materials cost for May $ LINK TO TEXT LINK TO TEXT LINK TO TEXT What is the unit conversion cost for May? (Round unit cost to 2 decimal places, e.g. 2.25.) The unit conversion cost for May $ LINK TO TEXT LINK TO TEXT LINK TO TEXT What is the total cost of units transferred out in May? The total cost of units transferred out in May $ LINK TO TEXT LINK TO TEXT LINK TO TEXT What is the cost of the May 31 inventory? Work in process $ Click if you would like to Show Work for this question: Open Show Work

Answer 1

UNITS TO ACCOUNT FOR:
Beginning Work in Process units				500
Add: Units Started in Process				1,600
Total Units to account for:				2,100
UNITS TO BE ACCOUNTED FOR:
Units started and completed				1,500
Ending Work in Process				600
Total Units to be accounted for:				2,100
Equivalent Units:
			Material Cost		Conversion
			% Completion	Units	% Completion	Units
Units started and completed			100%	1,500	100%	1,500
Ending Work in Process			100%	600	40%	240
Total Equivalent units				2,100		1,740
TOTAL COST TO ACCOUNT FOR:
			Material		Conversion
Beginning work in Process			2,840		950
Cost Added during May			7,030		7,228
Total Cost to account for:			9,870		8,178
Total Cost to account for:					18,048
COST PER EQUIVALENT UNIT:
			Material		Conversion
Total cost added during the year			9,870		8,178
Equivalent Units			2,100		1,740
Cost per Equivalent unit			4.7		4.7
TOTAL COST ACCOUNTED FOR:
Units completed and Transferred out (1500 units)
			Equivalent unit	Cost per EU	Total Cost
Material			1,500	4.7	7050
Conversion Cost			1,500	4.7	7050
Total Cost of Units completed and transferred out:					14100
Ending Work in process (600 units)
			Equivalent unit	Cost per EU	Total Cost
Material			600	4.7	2820
Conversison Cost			240	4.7	1128
Total cost of Ending Work in process:					3,948
Units in Ending WIP: 600 units
Material cost per unit: 4.7
Conversion cost per unit: 4.7 per unit
Costt of units completed and transferred out: $ 14100
Cost of Enidng WIP: 3948