Question

Otylia Manufacturing Company assembles its product in several departments. It has two departments that process all units. During February, the beginning work in process in the cutting department was half completed as to conversion, and complete as to direct materials. The beginning inventory included $12,000 for materials and $3,000 for conversion costs. Ending work-in-process inventory in the cutting department was 40% complete. Direct materials are added at the beginning of the process.

Beginning work in process in the finishing department was 75% complete as to conversion. Beginning inventories included $16,000 for transferred-in costs and $20,000 for conversion costs. Ending inventory was 25% complete. Additional information about the two departments follows:

Cutting Finishing

Beginning work-in-process units 20,000 20,000

Units started this period 40,000 50,000

Units transferred this period 50,000

Ending work-in-process units 10,000 20,000

Material costs added $51,000 $28,000

Direct manufacturing labor $18,700 $40,000

Other conversion costs $26,900 $24,000

Required:

Prepare a production cost worksheet using weighted-average for the cutting department.

Answer: Production Cost Worksheet

Cutting Department

Weighted-Average Method

Flow of production Physical Units Direct Materials Conversion

Work in process, beginning 20,000

Started during period 40,000

To account for 60,000

Units transferred out 50,000

Work in process, ending 10,000

Accounted for 60,000

Costs Totals Direct Materials Conversion

Work in process, beginning

Costs added during period

Total costs to account for

Divided by equivalent units

Equivalent-unit costs

Assignment of costs - Units Cost per unit Amount

Transferred out   

Work in process, ending

Direct materials

Conversion

Costs accounted for

Answer 1

Sollution

Otylia Manufacturing Company-Cutting Department
Equivalent units of production (EUP)-Cutting Department: - Weighted Average method
Detail	Physical Units	%Material	EUP-Material	% Conversion	EUP- Conversion
Units Transferred Out	50000	100%	50000	100%	50000
units of Ending work in process	10000	100%	10000	40%	4000
Equivalent units of production			60000		54000
Cost per EUP		Total Production Cost	Direct Material	Conversion
Cost of beginning Work in Process		$15,000.00	$12,000.00	$3,000.00
Cost Addrd during the period		$69,700.00	$51,000.00	$18,700.00
Total Cost to account for		$84,700.00	$63,000.00	$21,700.00
Equivalent units of Production			$60,000.00	$54,000.00
Cost per Equivalent unit of Production			$1.05	$0.4019
Cost of Units Transferred Out		Unit	Cost per Unit	Amount
Material		50000	$1.05	$52,500.00
Conversion		50000	$0.40	$20,092.59
Total transferred out				$72,592.59
Cost of ending work in process
Material		10000	$1.05	$10,500.00
Conversion		4000	$0.40	$1,607.41
Total Ending work in process				$12,107.41
Total Costs accounted for					$84,700.00