Question

Washington, Inc., makes three models of motorized carts for vacation resorts, X-10, X-20, and X-40. Washington manufactures the carts in two assembly departments: Department A and Department B. All three models are processed initially in Department A, where all material is assembled. The X-10 model is then transferred to finished goods. After processing in Department A, the X-20 and X-40 models are transferred to Department B for final assembly, and then transferred to finished goods.

There were no beginning work-in-process inventories on April 1. Data for April are shown in the following table. Ending work in process is 30 percent complete in Department A and 60 percent complete in Department B. Conversion costs are allocated based on the number of equivalent units processed in each department.

	Total			X-10			X-20			X-40
Units started					520			330			210
Units completed in Department A					370			250			180
Units completed in Department B								230			155
Materials	$	305,000		$	65,000		$	82,500		$	157,500
Conversion costs:
Department A	$	263,400
Department B		30,900
Total conversion costs	$	294,300

Required:

a. What is the unit cost of each model transferred to finished goods in April? (Do not round intermediate calculations.)

b. What is the balance of work-in-process inventory on April 30 for Department A? Department B? (Do not round intermediate calculations.)

Thank you!

Answer 1

	X-10	X-20	X-40	Total
Material cost	65000	82500	157500	305000
Conversion cost
Dept. A	124500	82200	56700	263400	Allocated in ratio of (415:274:189)
Dept. B		18150	12750	30900	Allocated in ratio of (242:170)
Total Cost	189500	182850	226950	599300
Completed Cost per unit	512.1622	795	1464.194		Allocated in 370:230:155 units
Balance WIP
Dep A	23400				Allocated for 78 equivalent units
Dep B	2,025				Allocated for 27 equivalent units
	X-10	X-20	X-40
Allocated ratio
Dept A
Completed	370	250	180	800
WIP	150	80	30	260
Equivalent WIP @30%	45	24	9	78
Total units	415	274	189	878
	X-20	X-40
Allocated ratio
Dept B
Completed	230	155	385
WIP	20	25	45
Equivalent WIP @60%	12	15	27
Total units	242	170	412