Question

Bettie Corporation uses a weighted-average process costing system to collect costs related to production. The following selected information relates to production for October:

	Materials				Conversion
Units completed and transferred out		50,000				50,000
Equivalent units: work in process, October 31		10,000				4,000
Total equivalent units		60,000				54,000

	Materials				Conversion
Costs in work in process on October 1	$	9,000			$	5,400
Costs added to production during October		243,000				513,000
Total cost	$	252,000			$	518,400

All materials at Bettie are added at the beginning of the production process.

What total amount of cost should be assigned to the units completed and transferred out during October?

Multiple Choice

$677,500

$642,000

$691,900

$690,000

Answer 1

UNITS TO ACCOUNT FOR:
Beginning Work in Process units				9,000
Add: Units Started in Process				162,000
Total Units to account for:				171,000
UNITS TO BE ACCOUNTED FOR:
Units completed from Beginning WIP				9000
Units started and completed				155,100
Ending Work in Process				6,900
Total Units to be accounted for:				171,000
Equivalent Units:
			Material Cost		Conversion
			% Completion	Units	% Completion	Units
Units completed from Beg. WIP			0%	0	67%	6,000
Units started and completed			100%	155,100	100%	155,100
Ending Work in Process			100%	6,900	80%	5,520
Total Equivalent units				162,000		166,620
TOTAL COST TO ACCOUNT FOR:
			Material		Conversion
Beginning work in Process			9,000		5,400
Cost Added during May			243,000		513,000
Total Cost to account for:			252,000		518,400
Total Cost to account for:					770,400
COST PER EQUIVALENT UNIT:
			Material		Conversion
Total cost added during the year			252,000		518,400
Equivalent Units			60,000		54,000
Cost per Equivalent unit			4.2		9.6
TOTAL COST ACCOUNTED FOR:
Units Completed and Transferred out (50000 units)
			Equivalent unit	Cost per EU	Total Cost
Material			50,000	4.2	210000
Conversion Cost			50,000	9.6	480000
Total Cost of Units completed and transferred out:					690000
Answer is $ 690000