Question

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Use the following information for the Exercises below.

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The Fields Company has two manufacturing departments, forming and painting. The company uses the weighted-average method of process costing. At the beginning of the month, the forming department has 30,000 units in inventory, 60% complete as to materials and 40% complete as to conversion costs. The beginning inventory cost of $75,100 consisted of $53,800 of direct materials costs and $21,300 of conversion costs.

During the month, the forming department started 450,000 units. At the end of the month, the forming department had 35,000 units in ending inventory, 80% complete as to materials and 40% complete as to conversion. Units completed in the forming department are transferred to the painting department.

Cost information for the forming department is as follows:

Beginning work in process inventory	$	75,100
Direct materials added during the month		1,677,380
Conversion added during the month		1,121,610

Exercise 16-6 Weighted average: Cost per EUP and costs assigned to output LO C2

1.
Calculate the equivalent units of production for the forming department.

2.
Calculate the costs per equivalent unit of production for the forming department.

3.
Using the weighted-average method, assign costs to the forming department’s output—specifically, its units transferred to painting and its ending work in process inventory.

Answer 1

1)

Equivalent Units of Production—Weighted Average	Direct Material	Conversion Cost
Units completed & transferred out	445,000.00	445,000.00
Units of ending work in process
Direct materials (35,000 × 80%)	28,000.00
Conversion (35,000 × 40%)		14,000.00
Equivalent units of production	473,000.00	459,000.00

2)

Cost per Equivalent Unit—Weighted Average	Direct Material	Conversion Cost
Costs of beginning work in process	$           53,800.00	$              21,300.00
Costs incurred this period	$     1,677,380.00	$        1,121,610.00
Total Costs	$     1,731,180.00	$        1,142,910.00
Equivalent units of production	473,000.00	459,000.00
Cost per equivalent unit of production	$                      3.66	$                         2.49

3)

Cost Assignment and Reconciliation
Cost of Units Transferred Out	EUP	Cost Per EUP	Total Cost
Direct materials	445,000.00	$                         3.66	$ 1,628,700.00
Conversion	445,000.00	$                         2.49	$ 1,108,050.00
Total Costs Transferred Out				$ 2,736,750.00
Cost of ending work in Process
Direct materials	28,000.00	$                         3.66	$      102,480.00
Conversion	14,000.00	$                         2.49	$        34,860.00
Total cost of ending work in Process				$      137,340.00
Total Cost assigned				$ 2,874,090.00