Question

Problem 16-6A (Part Level Submission) Hamilton Processing Company uses a weighted-average process cost system and manufactures a single product—an industrial carpet shampoo and cleaner used by many universities. The manufacturing activity for the month of October has just been completed. A partially completed production cost report for the month of October for the Mixing and Cooking department is as follows. Collapse question part (a) Prepare a schedule that shows how the equivalent units were computed so that you can complete the “Quantities: Units accounted for” equivalent units section shown in the production cost report, and compute October unit costs. (Round unit costs to 2 decimal places, e.g. 2.25.) HAMILTON PROCESSING COMPANY Mixing and Cooking Department Production Cost Report For the Month Ended October 31 Equivalent Units Quantities Physical Units Materials Conversion Costs Units to be accounted for Work in process, October 1 (all materials, 70% conversion costs) 24,600 Started into production 184,500 Total units 209,100 Units accounted for Transferred out 147,600 Work in process, October 31 (60% materials, 40% conversion costs) 61,500 Total units accounted for 209,100 Costs Materials Conversion Costs Total Unit costs Total Costs $295,200 $129,150 $424,350 Equivalent units Unit costs $ $ $ Costs to be accounted for Work in process, October 1 $36,900 Started into production 387,450 Total costs

Answer 1

Solution:

Computation of Equivalent unit of Production - Weighted Average
Particulars	Physical Units	Material	Conversion
Unit completed & Transferred out	147600	147600	147600
Closing WIP:	61500
Material (60%)		36900
Conversion (40%)			24600
Equivalent units of production	209100	184500	172200

Computation of Cost per equivalent unit of Production - Weighted Average
Particulars	Material	Conversion
Total cost to be accounted for	$295,200.00	$129,150.00
Equivalent units of production	184500	172200
Cost per Equivalent unit	$1.60	$0.75

Computation of Cost of ending WIP and units completed & transferred out - Weighted Average
Particulars	Material	Conversion	Total
Equivalent unit of Ending WIP	36900	24600
Cost per equivalent unit	$1.60	$0.75
Cost of Ending WIP (Equivalent unit * Cost per equivalent unit)	$59,040	$18,450	$77,490
Units completed and transferred	147600	147600
Cost of units completed & Transferred (Unit completed * cost per equivalent unit)	$236,160	$110,700	$346,860

Cost Reconciliation - Weighted Average
Particulars	Amount
Costs to be accounted for:
Cost of beginning WIP inventory	$36,900.00
Cost added to production	$387,450.00
Total Cost to be accounted for	$424,350.00
Costs accounted for as follows:
Cost of unit transferred out	$346,860.00
Ending WIP:
Material	$59,040.00
Converison	$18,450.00
Total cost accounted for	$424,350.00