Question

Piscataway Plastics Company manufactures a highly specialized plastic that is used extensively in the automobile industry. The following data have been compiled for the month of June. Conversion activity occurs uniformly throughout the production process.

Work in process, June 1—60,000 units:
Direct material: 100% complete, cost of	$	292,500
Conversion: 40% complete, cost of		159,200
Balance in work in process, June 1	$	451,700
Units started during June		240,000
Units completed during June and transferred out to finished-goods inventory		190,000
Work in process, June 30:
Direct material: 100% complete
Conversion: 60% complete
Costs incurred during June:
Direct material	$	487,500
Conversion costs:
Direct labor	$	81,800
Applied manufacturing overhead		245,400
Total conversion costs	$	327,200

Required:

Prepare schedules to accomplish each of the following process-costing steps for the month of June. Use the weighted-average method of process costing.

1. Analysis of physical flow of units.

2. Calculation of equivalent units.

3. Computation of unit costs.

4. Analysis of total costs.

OPTIONS:

• Direct-material costs
• Units completed and transferred out during June
• Units started during June
• Work in process, June 1
• Work in process, June 30
• Conversion costs
• Costs incurred during June

Analysis of physical flow of units.

	Physical Units Total units to account for Total units accounted for

Calculation of equivalent units.

	Equivalent Units Physical Units Direct Material Conversion Total units accounted for Total equivalent units

Computation of unit costs. (Round "Cost per equivalent unit" to 2 decimal places.)

	Direct Material Conversion Total Total costs to account for Equivalent units Costs per equivalent unit

Analysis of total costs. (Round "Cost per equivalent unit" to 2 decimal places.)

	Number of Equivalent Units Cost per Equivalent Unit Total Cost Cost of goods completed and transferred Direct material (Ending WIP Inventory) Conversion (Ending WIP Inventory) Total costs accounted for

Answer 1

Physical Flow of units

Unit to be accounted for
Beginning work in process	60000
Unit started	240000
Total Units to be accounted for	300000
Units accounted for
Units transferred out	190000
Ending work in process	110000
Total units accounted for	300000

Equivalent unit

	Physical units	EUP-Material	EUP-Conversion
Unit completed and transferred out	190000	190000	190000
Ending work in process	110000	110000	66000
Total units accounted for	300000
Total equivalent unit		300000	256000

Cost per equivalent unit

	Direct material	Conversion	Total Cost
Beginning WIP	292500	159200	451700
Cost added	487500	327200	814700
Total Cost	780000	486400	1266400
Equivalent unit	300000	256000
Cost per equivalent unit	2.6	1.9	4.5

Analysis of cost

	No of equivalent unit	Cost per equivalent unit	Total Cost
Cost of goods completed and transferred	190000	4.5	855000
Cost of ending work in process (Direct material)	110000	2.6	286000
Cost of ending work in process (Conversion)	66000	1.9	125400
Total Costs accounted for			1266400