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

The following data pertain to the Vesuvius Tile Company for July.

Work in process, July 1 (in units) .......................................................................................................................20,000

Units started during July ...................................................................................................................................?

Total units to account for ..................................................................................................................................65,000

Units completed and transferred out during July ................................................................................................?

Work in process, July 31 (in units) .....................................................................................................................15,000

Total equivalent units: direct material .................................................................................................................65,000

Total equivalent units: conversion ......................................................................................................................?

Work in process, July 1: direct material .............................................................................................................$164,400

Work in process, July 1: conversion ...................................................................................................................?

Costs incurred during July: direct material .........................................................................................................?

Costs incurred during July: conversion ..............................................................................................................659,400

Work in process, July 1: total cost .....................................................................................................................244,200

Total costs incurred during July .........................................................................................................................1,031,250

Total costs to account for ..................................................................................................................................1,275,450

Cost per equivalent unit: direct material .............................................................................................................8.25

Cost per equivalent unit: conversion ..................................................................................................................?

Total cost per equivalent unit ............................................................................................................................21.45

Cost 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 .........................................................................79,200

Total cost of July 31 work in process .................................................................................................................202,950

Additional 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.

c. 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.

Problem 4–27 Missing Data; Production Report; Weighted-Average (LO 4, 5, 6)

Cost remaining in ending work-in-process inventory, direct material: $123,750

Total cost of July 31 work in process: $202,950

Chapter 4 Process Costing and Hybrid Product-Costing Systems 159

Required: Compute the missing amounts, and prepare the firm’s July production report

Solutions

Expert Solution

Solution:

Unit started in July = Total units to be accounted for - Units in beinning WIP = 65000 - 20000 = 45000

Units completed and transferred out = Total units to be accounte for - Units in ending WIP = 65000 - 15000 = 50000 units

Cost per equivalent unit of direct material = $8.25

Total equivalent unit of direct material = 65000

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

Cost of direct material in beginning WIP = $164,400

Direct material cost incurred in july = $536,250 - $164,400 = $371,850

Total cost per equivalent unit = $21.45

Cost per equivalent unit for conversion = $21.45 - $8.25 = $13.20

Total cost to be accounted for = $1,275,450

Conversion cost to be accounted for = $1,275,450 - $536,250 = $739,200

Equivalent units of conversion = $739,200 / $13.20 = 56000 units

Conversion cost included in beginning WIP = $244,200 - $164,400 = $79,800

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 July	$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

ekkarill92 answered 1 year ago

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