Question

The Fields Company has two manufacturing departments, forming and painting. The company uses the weighted-average method of process costing. At the beginning of the month, the forming department has 30,000 units in inventory, 60% complete as to materials and 40% complete as to conversion costs. The beginning inventory cost of $70,100 consisted of $50,800 of direct materials costs and $19,300 of conversion costs.

During the month, the forming department started 400,000 units. At the end of the month, the forming department had 40,000 units in ending inventory, 85% complete as to materials and 35% complete as to conversion. Units completed in the forming department are transferred to the painting department.

Cost information for the forming department is as follows:

Beginning work in process inventory	$	70,100
Direct materials added during the month		1,539,200
Conversion added during the month		1,047,260

Exercise 20-6 Weighted average: Cost per EUP and costs assigned to output LO C2

1.
Calculate the equivalent units of production for the forming department.

	Direct Materials Conversion

2.
Calculate the costs per equivalent unit of production for the forming department.

	Direct Materials per EUP Conversion per EUP

3.
Using the weighted-average method, assign costs to the forming department’s output—specifically, its units transferred to painting and its ending work in process inventory.

	Cost Assignment and Reconciliation Cost of units transferred out EUP Cost per EUP Total cost Direct materials Conversion Total costs transferred out Costs of ending work in process EUP Cost per EUP Total cost Direct materials Conversion Total cost of ending work in process Total costs assigned

Answer 1

Beginning work in process			30,000	Completed & Transferrred			390,000
started during the year			400,000	Ending work in process			40,000
units to be accounted			430,000	units accounted for			430,000
Equivalent units
			units	%	materials	%	CC
completed & transferred			390,000	100%	390,000	100%	390,000
ending work in process			40,000	85%	34000	35%	14000
Equivalent units					424,000		404,000
1	Equivalent units
	Materials		424,000
	Conversion		404,000
cost per equivalent units
			Materials	CC	total
beginning work in process			50,800	19,300	70,100
cost added during the year			1,539,200	1,047,260	2,586,460
total cost			1,590,000	1,066,560	2,656,560
Equilvalent units			424,000	404,000
cost per unit			3.75	2.64	6.39
2)	cost per Equivalent units
	materials		3.75
	Conversion		2.64
3)
cost Assignment and Reconciliation
cost of units transferred out				EUP	per EUP	total
direct materials				390,000	3.75	1462500
conversion				390,000	2.64	1029600
total costs transferred out						2492100
cost of ending work in process
Direct materials				34000	3.75	127500
conversion				14000	2.64	36960
total cost of ending work in process						164460
total costs assinged						2656560