Richards Corporation uses the weighted-average method of process costing. The following information is available for October...

Richards Corporation uses the weighted-average method of process costing. The following information is available for October in its Fabricating Department:

Units:
Beginning Inventory: 80,000 units, 60% complete as to materials and 20% complete as to conversion.
Units started and completed: 250,000.
Units completed and transferred out: 330,000.
Ending Inventory: 30,000 units, 40% complete as to materials and 10% complete as to conversion.

Costs:
Costs in beginning Work in Process - Direct Materials: $37,200.
Costs in beginning Work in Process - Conversion: $79,700.
Costs incurred in October - Direct Materials: $646,800.
Costs incurred in October - Conversion: $919,300.

Calculate the equivalent units of conversion.

Solutions

Expert Solution

Calculation of equivalent units of production
Particulars	units	Percentage of Conversion	Equivalent units of Production
Units completed and transferred out	330000	100%	330000
Ending Inventory (30000*10%)	30000	10%	3000
Total Equivalent units of production (330000+3000)			333000

Calculation of total cost of conversion
Costs in beginning Work in Process - Conversion	$ 79,700
Costs incurred in October - Conversion	$ 919,300
Total cost of conversion (79700+919300)	$ 999,000

Calculation of the equivalent units of conversion
Total cost of conversion (79700+919300)	$ 999,000
Total Equivalent units of production (330000+3000)	333000
Equivalent units of conversion (999000/333000)	$ 3.00

ekkarill92 answered 1 year ago

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