Question

Exercise 5-12 Equivalent Units; Assigning Costs; Cost Reconciliation-Weighted-Average Method [LO5-2, LO5-4, LO5-5] Superior Micro Products uses the weighted-average method in its process costing system. During January, the Delta Assembly Department completed its processing of 26,400 units and transferred them to the next department. The cost of beginning work in process inventory and the costs added during January amounted to $674,318 in total. The ending work in process inventory in January consisted of 2,900 units, which were 60% complete with respect to materials and 40% 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 $ 12.70 $ 4.80 $ 6.70 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.)

Answer 1

1
	Materials	Labor	Overhead
Units completed and transferred out	26400	26400	26400
Work in process, ending:
2900 X 60%	1740
2900 X 40%		1160	1160
Equivalent units of production	28140	27560	27560
2
	Materials	Labor	Overhead	Total
Work in process, ending units	1740	1160	1160
X Cost per Equivalent unit	12.70	4.80	6.70
Cost of ending work in process inventory	22098	5568	7772	35438
3
	Materials	Labor	Overhead	Total
Units completed and transferred out	26400	26400	26400
X Cost per Equivalent unit	12.70	4.80	6.70
Cost of Units completed and transferred out	335280	126720	176880	638880
4
Cost Reconciliation:
Total Cost to be accounted for	674318
Cost accounted for as follows:
Cost of Units completed and transferred out	638880
Cost of ending work in process inventory	35438
Total Cost accounted for	674318