Question

Highlands Company uses the weighted-average method in its process costing system. It processes wood pulp for various manufacturers of paper products. Data relating to tons of pulp processed during June are provided below:  

		Percent Completed
	Tons of Pulp	Materials		Labor and Overhead
Work in process, June 1	81,700	86	%	22	%
Work in process, June 30	51,200	45	%	18	%
Started into production during June	301,800

Required:  

1. Compute the number of tons of pulp completed and transferred out during June.

2. Compute the equivalent units of production for materials and for labor and overhead for June.

Answer 1

Units completed and transferred out = 332,300 units

.

	Material	Conversion
Equivalent Units of Production	355,340	341,516

Working

Reconciliation of Units
A	Beginning WIP	81,700
B	Introduced	301,800
C=A+B	TOTAL	383,500
D	Transferred out	332,300
E=C-D	Ending WIP	51,200

.

Statement of Equivalent Units(Weighted average)
				Material		Conversion cost
	Units			Complete %	Equivalent units	Complete %	Equivalent units
Transferred out	332,300			100%	332,300	100%	332,300
Ending WIP	51,200			45%	23,040	18%	9,216
Total	383,500			Total	355,340	Total	341,516