Question

Builder Products, Inc., uses the weighted-average method in its process costing system. It manufactures a caulking compound that goes through three processing stages prior to completion. Information on work in the first department, Cooking, is given below for May:

Production data:
Pounds in process, May 1; materials 100% complete; conversion 90% complete		60,000
Pounds started into production during May		250,000
Pounds completed and transferred out		?
Pounds in process, May 31; materials 60% complete; conversion 40% complete		20,000
Cost data:
Work in process inventory, May 1:
Materials cost	$	59,000
Conversion cost	$	23,400
Cost added during May:
Materials cost	$	306,420
Conversion cost	$	128,580
Required: 1. Compute the equivalent units of production for materials and conversion for May. 2. Compute the cost per equivalent unit for materials and conversion for May. 3. Compute the cost of ending work in process inventory for materials, conversion, and in total for May. 4. Compute the cost of units transferred out to the next department for materials, conversion, and in total for May. 5. Prepare a cost reconciliation report for May.

Answer 1

1)
			Materials	Conversion
Equivalent units of Production			3,02,000	2,98,000
Working:
			Materials		Conversion
	Physical Units		% of completion	Equivalent Units of Production	% of completion	Equivalent Units of Production
Units completed and transferred out	2,90,000		100%	2,90,000	100%	2,90,000
Units in ending Work in process	20,000		60%	12,000	40%	8,000
Total	3,10,000			3,02,000		2,98,000
Work in process, Beginning	60,000
Add Units started during the period	2,50,000
Total Units to be accounted for	3,10,000
Less ending units in process	20,000
Units completed and transfererd out	2,90,000
2)
			Materials	Conversion
Cost per equivalent unit			$                           1.21	$                              0.51
Working:
			Materials	Conversion
Work in process Inventory			$                       59,000	$                          23,400
Costs added during the perod			$                   3,06,420	$                      1,28,580
Total Costs			$                   3,65,420	$                      1,51,980
/ Equivalent units of production			3,02,000	2,98,000
Cost per Euivalent units of produciton			$                           1.21	$                              0.51
3)
			Materials	Conversion	Total
Costs of Ending Work in process			$                       14,520	$                            4,080	$                  18,600
Working:
			Equivalent units of production	Unit Costs	Total Costs
Materials			12,000	$                              1.21	$                  14,520
Conversion Costs			8,000	$                              0.51	$                    4,080
Total					$                  18,600
4)
			Materials	Conversion	Total
Costs of Units transferred out			$                   3,50,900	$                      1,47,900	$              4,98,800
Working:
			Equivalent units of production	Unit Costs	Total Costs
Materials			2,90,000	$                              1.21	$              3,50,900
Conversion Costs			2,90,000	$                              0.51	$              1,47,900
Total					$              4,98,800
5)
Costs Reconcilation report
Beginning Work in process:
Materials	$             59,000
Conversion	$             23,400
Costs added during the period:
Materials	$          3,06,420
Conversion	$          1,28,580
Total Costs to be accounted for	$          5,17,400
Units completed and transferred out	4,98,800
Units in ending Work in process	18,600
Total costs acconted for	5,17,400