Question

Helix Corporation 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 5,000 100 % 40 % Work in process inventory, May 31 10,000 100 % 30 % Materials cost in work in process inventory, May 1 $ 1,500 Conversion cost in work in process inventory, May 1 $ 4,000 Units started into production 180,000 Units transferred to the next production department 175,000 Materials cost added during May $ 54,000 Conversion cost added during May $ 352,000

Answer 1

Solution:

Computation of Equivalent unit of Production - Weighted Average
Particulars	Physical Units	Material	Conversion
Unit completed & Transferred out	175000	175000	175000
Closing WIP:	10000
Material (100%)		10000
Conversion (30%)			3000
Equivalent units of production	185000	185000	178000

Computation of Cost per equivalent unit of Production - Weighted Average
Particulars	Material	Conversion
Opening WIP	$1,500.00	$4,000.00
Cost Added during June	$54,000.00	$352,000.00
Total cost to be accounted for	$55,500.00	$356,000.00
Equivalent units of production	185000	178000
Cost per Equivalent unit	$0.30	$2.00

Computation of Cost of ending WIP and units completed & transferred out - Weighted Average
Particulars	Material	Conversion	Total
Equivalent unit of Ending WIP	10000	3000
Cost per equivalent unit	$0.30	$2.00
Cost of Ending WIP (Equivalent unit * Cost per equivalent unit)	$3,000	$6,000	$9,000
Units completed and transferred	175000	175000
Cost of units completed & Transferred (Unit completed * cost per equivalent unit)	$52,500	$350,000	$402,500

Production cost report - Weighted Average
Particulars	Amount
Costs to be accounted for:
Cost of beginning WIP inventory	$5,500.00
Cost added to production	$406,000.00
Total Cost to be accounted for	$411,500.00
Costs accounted for as follows:
Cost of unit transferred out	$402,500
Ending WIP:
Material	$3,000
Converison	$6,000
Total cost accounted for	$411,500