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	55,000	100	%		40	%
Work in process inventory, May 31	35,000	100	%		25	%
Materials cost in work in process inventory, May 1				$	47,100
Conversion cost in work in process inventory, May 1				$	12,900
Units started into production					247,500
Units transferred to the next production department					267,500
Materials cost added during May				$	64,825
Conversion cost added during May				$	186,000

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

• All working forms part of the answer
• Requriement 1

EUP - Weighted Average Method	Units	% Material	EUP Materials	% Conversion	EUP - Conversion
Units TRANSFERRED	267,500	100%	267,500	100%	267,500
Units of ENDING WIP	35,000	100%	35,000	25%	8,750
Equivalent Units of Production			302,500		276,250

• Requirement 2

COST per EUP			Material		Conversion
Cost of Beginning WIP			$          47,100.00		$                                  12,900.00
Cost incurred during the period			$          64,825.00		$                                186,000.00
Total Costs		Costs	$        111,925.00	Costs	$                                198,900.00
Equivalent units of production		EUP	302,500	EUP	276,250
Cost per EUP			$              0.37000		$                                      0.72000

• Requirement 3

Cost of ending WIP	EUP	Cost per EUP	Total Cost
- Direct Materials	35,000	$                      0.37	$          12,950.00
- Conversion	8,750	$                      0.72	$             6,300.00
Total cost of ending WIP				$              19,250.00

• Requirement 4

Cost of Units Transferred Out	EUP	Cost per EUP	Total Cost
- Direct Materials	267,500	$                      0.37	$          98,975.00
- Conversion	267,500	$                      0.72	$        192,600.00
Total Cost transferred Out				$            291,575.00