Question

Superior Micro Products uses the weighted-average method in its process costing system. During January, the Delta Assembly Department completed its processing of 25,800 units and transferred them to the next department. The cost of beginning work in process inventory and the costs added during January amounted to $694,688 in total. The ending work in process inventory in January consisted of 3,800 units, which were 50% complete with respect to materials and 30% complete with respect to labor and overhead. The costs per equivalent unit for the month were as follows:

	Materials			Labor			Overhead
Cost per equivalent unit	$	13.70		$	4.90		$	6.80

Required:

1. Compute the equivalent units of materials, labor, and overhead in the ending work in process inventory for the month.

2. Compute the cost of ending work in process inventory for materials, labor, overhead, and in total for January.

3. Compute the cost of the units transferred to the next department for materials, labor, overhead, and in total for January.

4. Prepare a cost reconciliation for January. (Note: You will not be able to break the cost to be accounted for into the cost of beginning work in process inventory and costs added during the month.)

Compute the equivalent units of materials, labor, and overhead in the ending work in process inventory for the month.

	Materials Labor Overhead Equivalent units

Compute the cost of ending work in process inventory for materials, labor, overhead, and in total for January.

	Materials Labor Overhead Total Cost of ending work in process inventory

Compute the cost of the units transferred to the next department for materials, labor, overhead, and in total for January.

	Materials Labor Overhead Total Cost of units completed and transferred out

Prepare a cost reconciliation for January.

Cost Reconciliation Total cost to be accounted for Costs accounted for as follows: total cost accounted for

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Answer 1

Solution

	Material	Labor	Overhead
Equivalent units	27,700	26,940	26,940

.

	Material	Labor	Overhead	Total
Cost of ending work in process	$         26,030.00	$          5,586.00	$         7,752.00	$       39,368.00

.

	Material	Labor	Overhead	Total
Cost of Units Completed and transferred out	$       353,460.00	$      126,420.00	$     175,440.00	$     655,320.00

.

Cost reconciliation
Total cost to be accounted for	$       599,780.00
Costs accounted for as follows
Cost of ending work in process	$         39,368.00
Cost of Units Completed and transferred out	$       655,320.00
Total costs accounted for	$       694,688.00

Working

Statement of Equivalent Units(Weighted average)
		Material		Material		Conversion
	Units			Complete %	Equivalent units	Complete %	Equivalent units
Transferred	25,800	100%	25,800.0	100%	25,800.0	100%	25,800
Closing WIP	3,800	50%	1,900.0	30%	1,140.0	30%	1,140
Total	29,600		27,700	Total	26,940.0	Total	26,940

.

Statement of cost (Weighted average)
Cost	Equivalent Cost/unit	Ending WIP		Transferred
		Units	Cost Allocated	Units	Cost Allocated
Material	$                 13.70	1,900	$       26,030.00	25,800	$ 353,460
Labor	$                    4.90	1,140	$         5,586.00	25,800	$ 126,420
Overhead	$                    6.80	1,140	$         7,752.00	25,800	$ 175,440
		TOTAL	$ 39,368	TOTAL	$ 655,320