Question

Helix Corporation uses the weighted-average method in its process costing system. It produces prefabricated flooring in a series of steps carried out in production departments. All of the material that is used in the first production department is added at the beginning of processing in that department. Data for May for the first production department follow:

		Percent Complete
	Units	Materials			Conversion
Work in process inventory, May 1	73,000	100	%		50	%
Work in process inventory, May 31	53,000	100	%		30	%
Materials cost in work in process inventory, May 1				$	57,900
Conversion cost in work in process inventory, May 1				$	17,000
Units started into production					251,200
Units transferred to the next production department					271,200
Materials cost added during May				$	120,410
Conversion cost added during May				$	244,261

Required:

1. Calculate the first production department's equivalent units of production for materials and conversion for May.

2. Compute the first production department's cost per equivalent unit for materials and conversion for May.

3. Compute the first production department's cost of ending work in process inventory for materials, conversion, and in total for May.

4. Compute the first production department's cost of the units transferred to the next production department for materials, conversion, and in total for May.

Answer 1

1. Calculate the first production department's equivalent units of production for materials and conversion for May.

		Equivalent unit of production
	Whole unit	Material	Conversion
Units transferred to the next production department	271200	271200	271200
Ending work in process unit	53000	53000	53000*30% = 15900
Total	324200	324200	287100

2. Compute the first production department's cost per equivalent unit for materials and conversion for May.

	Material	Conversion
Beginning work in process	57900	17000
Cost added	120410	244261
Total cost	178310	261261
Equivalent unit of production	324200	287100
Cost per equivalent unit	0.55	0.91

3. Compute the first production department's cost of ending work in process inventory for materials, conversion, and in total for May.

	Material	Conversion	Total
Cost of ending work in process	53000*.55 = 29150	15900*.91 = 14469	43619

4. Compute the first production department's cost of the units transferred to the next production department for materials, conversion, and in total for May.

	Material	Conversion	Total
Cost of units transferred to the next production	271200*.55 = 149160	271200*.91 = 246792	395952