Question

Weston Products manufactures an industrial cleaning compound that goes through three processing departments—Grinding, Mixing, and Cooking. All raw materials are introduced at the start of work in the Grinding Department. The Work in Process T-account for the Grinding Department for May is given below:

Work in Process—Grinding Department
Inventory, May 1	21,800	Completed and transferred to the Mixing Department	?
Materials	133,400
Conversion	225,500
Inventory, May 31	?

The May 1 work in process inventory consisted of 18,000 pounds with $14,600 in materials cost and $7,200 in conversion cost. The May 1 work in process inventory was 100% complete with respect to materials and 30% complete with respect to conversion. During May, 167,000 pounds were started into production. The May 31 inventory consisted of 15,000 pounds that were 100% complete with respect to materials and 60% complete with respect to conversion. The company uses the weighted-average method in its process costing system.

Required:

1. Compute the Grinding Department's equivalent units of production for materials and conversion in May.

2. Compute the Grinding Department's costs per equivalent unit for materials and conversion for May.

3. Compute the Grinding Department's cost of ending work in process inventory for materials, conversion, and in total for May.

4. Compute the Grinding Department's cost of units transferred out to the Mixing Department for materials, conversion, and in total for May.

Answer 1

1			Equivalent Units
		Whole Units	Materials		Conversion
	Work in process, May 1	18000
	Started into production	167000
	Total units to account for	185000
	Transferred to Mixing Department	170000	100%	170000	100%	170000
	Work in process, May 31	15000	100%	15000	60%	9000
	Total units accounted for	185000
	Total equivalent units of production			185000		179000
2		Materials	Conversion	Total
	Work in process, May 1 $	14600	7200	21800
	Costs incurred during the month	133400	225500	358900
	Total costs $	148000	232700	380700
	÷ Equivalent units of production	185000	179000
	Cost per equivalent unit $	0.80	1.30	2.10
3	Cost of ending work in process:	Materials	Conversion	Total
	Equivalent units of production	15000	9000
	Cost per equivalent unit $	0.80	1.30
	Total cost of ending work in process $	12000	11700	23700
4	Cost of units transferred out:	Materials	Conversion	Total
	Equivalent units of production	170000	170000
	Cost per equivalent unit $	0.80	1.30
	Total cost of units transferred out $	136000	221000	357000