Question

Sunspot Beverages, Ltd., of Fiji uses the weighted-average method in its process costing system. It makes blended tropical fruit drinks in two stages. Fruit juices are extracted from fresh fruits and then blended in the Blending Department. The blended juices are then bottled and packed for shipping in the Bottling Department. The following information pertains to the operations of the Blending Department for June.

		Percent Completed
	Units	Materials	Conversion
Work in process, beginning	125,000	55%	50%
Started into production	199,000
Completed and transferred out	189,000
Work in process, ending	135,000	60%	40%

	Materials		Conversion
Work in process, beginning	$	14,300	$	4,100
Cost added during June	$	153,100	$	88,240

Calculate the Blending Department's equivalent units of production for materials and conversion in June and Calculate the Blending Department's cost per equivalent unit for materials and conversion in June?

Answer 1

Flow of production
	Physical Units		Equivalent Units
			Transferred In	Materials	Conversion
Beginning Inventory	125000
Started during the period	199000
To account for	324000
Completed and Transferred Out	189000		189000	189000	189000
Ending Inventory	135000		135000	81000	54000
Units accounted for (Equivalent      units)	324000		324000	270000	243000
%Ending Inventory complete			100%	60%	40%
Cost per equivalent unit						Total
Beginning Inventory Costs			-	14,300.00	4,100.00	18,400.00
Costs added			-	153,100.00	88,240.00	241,340.00
Total costs to date			-	167,400.00	92,340.00	259,740.00
Equivalent units			324,000.00	270,000.00	243,000.00
Cost per equivalent unit			-	0.62	0.38
Assignment of costs						Total
Completed and transferred out			-	117,180.00	71,820.00	189,000.00
Ending Inventory			-	50,220.00	20,520.00	70,740.00
						259,740.00