Question
In: Accounting
At the end of the month, Michael Company calculated equivalent units of production in the Packaging Department as shown below:
Ascertaining the cost of equivalent units using Weighted Average costing.
At the end of the month, Michael Company calculated equivalent units of production in the Packaging Department as shown below:
Solutions
Expert Solution
The Direct Material Cost of $8 and the Conversion Cost of $9 is applied to the number of Equivalent units for both Completed & Transferred Units and the Ending WIP Units.
Cost of Ending WIP = (Equivalent Units for DM x Unit DM Cost) + (Equivalent units for Conv Cost x Conv Cost per unit)
= (5000 x $8) + (3000 x $9)
= $67,000
Cost of Completed & Transferred Units = (Equivalent Units for DM x Unit DM Cost) + (Equivalent units for Conv Cost x Conv Cost per unit)
= (51000 x $8) + (51000 x $9)
= $867,000
Cost of ending WIP Inventory: $67,000
Cost of units completed and transferred out: $867,000
Soumik Mallick Choudhury answered 2 years agoRelated Solutions
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ACCOUNT Work in Process—Baking Department ACCOUNT NO.
Date Item Debit Credit Balance Debit Credit
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31 Direct materials, 108,000 units 183,600 204,000
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Department
ACCOUNT NO.
Date
Item
Debit
Credit
Balance
Debit
Credit
March
1
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21,060
31
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Department
ACCOUNT NO.
Date
Item
Debit
Credit
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Debit
Credit
March
1
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31
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31
Direct labor
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31
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ACCOUNT NO.
Date
Item
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Credit
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31
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31
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