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Diulio Company produces a product in a process-costing system involving several departments
Diulio Company produces a product in a process-costing system involving several departments. The company uses the weighted-average method of process costing. The first department's data for the month of April follow:
Units in beginning work-in-process inventory 15,000
Units started during April 140,000
Units completed during April 120,000
Units in ending work-in-process inventory 35,000
Direct materials added in current month $168,000
Conversion costs added in current month $186,000
Direct materials-beginning work-in-process inventory $25,750
Conversion costs-beginning work-in-process inventory $3,225
Stage of Completion:
Materials Conversion Costs
Beginning work-in-process inventory 50% 40%
Ending work-in-process inventory 50% 30%
Required:
A) Compute equivalent units for materials and conversion costs.
B) Compute the cost per unit for materials and conversion costs. Round to two decimal places.
C) Compute the cost of the units transferred.
D) Compute the cost of the ending work-in-process inventor
Expert Solution
| Computation of Equivalent unit of Production - Weighted Average | |||
| Particulars | Physical Units | Material | Conversion |
| Unit completed & Transferred out | 120000 | 120000 | 120000 |
| Units in Ending Work-in-Process Inventory: | 35000 | ||
| Material (50%) | 17500 | ||
| Conversion (30%) | 10500 | ||
| Equivalent units of production | 155000 | 137500 | 130500 |
| Computation of Cost per equivalent unit of Production - Weighted Average: | ||
| Particulars | Material | Conversion |
| Beginning Work-in-Process Inventory | $25,750.00 | $3,225.00 |
| Cost Added during January | $168,000.00 | $186,000.00 |
| Total cost to be accounted for | $193,750.00 | $189,225.00 |
| Equivalent units of production | 137500 | 130500 |
| Cost per Equivalent unit | $1.41 | $1.45 |
| Computation of Cost of ending WIP and units completed & transferred out - Weighted Average (First Department) | |||
| Particulars | Material | Conversion | Total |
| Equivalent Units of Ending Work-in-Process | 17500 | 10500 | |
| Cost per Equivalent Unit | $1.41 | $1.45 | |
| Cost of Ending WIP (Equivalent unit * Cost per equivalent unit) | $24,659 | $15,225 | $39,884 |
| Units completed and transferred | 120000 | 120000 | |
| Cost of units completed & Transferred (Unit completed * cost per equivalent unit) | $169,091 | $174,000 | $343,091 |
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