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The following data pertain to the Vesuvius Tile Company for July.Work in process, July 1 (in...

The following data pertain to the Vesuvius Tile Company for July.Work in process, July 1 (in units) .......................................................................................................................20,000Units started during July ...................................................................................................................................?Total units to account for ..................................................................................................................................65,000Units completed and transferred out during July ................................................................................................?Work in process, July 31 (in units) .....................................................................................................................15,000Total equivalent units: direct material .................................................................................................................65,000Total equivalent units: conversion ......................................................................................................................?Work in process, July 1: direct material .............................................................................................................$164,400Work in process, July 1: conversion ...................................................................................................................?Costs incurred during July: direct material .........................................................................................................?Costs incurred during July: conversion ..............................................................................................................659,400Work in process, July 1: total cost .....................................................................................................................244,200Total costs incurred during July .........................................................................................................................1,031,250Total costs to account for ..................................................................................................................................1,275,450Cost per equivalent unit: direct material .............................................................................................................8.25Cost per equivalent unit: conversion ..................................................................................................................?Total cost per equivalent unit ............................................................................................................................21.45Cost of goods completed and transfered out during July ......................................................................................?Cost remaining in ending work-in-process inventory: direct material ...................................................................?Cost remaining in ending work-in-process inventory: conversion .........................................................................79,200Total cost of July 31 work in process .................................................................................................................202,950Additional Information: a. Direct material is added at the beginning of the production process, and conversion activity occurs uniformly throughout the process. b. The company uses weighted-average process costing.

The July 1 work in process was 30 percent complete as to conversion. d. The July 31 work in process was 40 percent complete as to conversion. Required: Compute the missing amounts, and prepare the firm’s July production report.

Solutions

Expert Solution

Solution:

Total units to be accounted for = 65000 units

Units in beginning WIP = 20000 units

Units started during period = 65000 - 20000 = 45000 units

Units in ending WIP = 15000 units

Units completed during period = 65000 - 15000 = 50000 units

Cost per equivalant unit - Direct material = $8.25

Total Cost per equivalant unit = $21.45

Cost per equivalant unit - conversion = $21.45 - $8.25 = $13.20

Total cost of direct material = 65000 * $8.25 = $536,250

Direct material cost in beginning WIP = $164,400

Direct material cost incurred during period = $536,250 - $164,400 = $371,850

Equivalant units of conversion = 50000 + 15000*40% = 56000 units

Computation of Equivalent unit of Production - Weighted Average
Particulars Physical Units Material Conversion
Unit completed & Transferred out 50000 50000 50000
Closing WIP: 15000
Material (100%) 15000
Conversion (40%) 6000
Equivalent units of production 65000 65000 56000
Computation of Cost per equivalent unit of Production - Weighted Average
Particulars Material Conversion
Opening WIP $164,400.00 $79,800.00
Cost Added during January $371,850.00 $659,400.00
Total cost to be accounted for $536,250.00 $739,200.00
Equivalent units of production 65000 56000
Cost per Equivalent unit $8.25 $13.20
Computation of Cost of ending WIP and units completed & transferred out - Weighted Average
Particulars Material Conversion Total
Equivalent unit of Ending WIP 15000 6000
Cost per equivalent unit $8.25 $13.20
Cost of Ending WIP (Equivalent unit * Cost per equivalent unit) $123,750 $79,200 $202,950
Units completed and transferred 50000 50000
Cost of units completed & Transferred (Unit completed * cost per equivalent unit) $412,500 $660,000 $1,072,500
Cost reconciliation - Weighted Average
Particulars Amount
Costs to be accounted for:
Cost of beginning WIP inventory $244,200.00
Cost added to production $1,031,250.00
Total Cost to be accounted for $1,275,450.00
Costs accounted for as follows:
Cost of unit transferred out $1,072,500
Ending WIP:
Material $123,750
Converison $79,200
Total cost accounted for $1,275,450

Total cost of conversion = 56000 * $13.20 = $739,200

conversion cost incurred during july = $659,400

Converstion cost from begining WIP = $739,200 - $659,400 = $79,800

ekkarill92 answered 1 year ago
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