Equivalent Units and Cost per Equivalent Unit—Weighted-Average Method
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Grand River Company produces a high-quality insulation material that passes through two production processes. Data for November for the first process follow:
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CompletionCompletion
with Respectwith Respect
Units to materialsto Conversion
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Work in process inventory, November 1 ...... 80,00050%25%
Work in process inventory, November 30.....60,00045%20%
Materials cost in work in process
Inventory, November 1 $76,600
Conversion cost in work in process
Inventory, November 1 $34,900
Units started into production 300,000
Units transferred to the next process 320,000
Materials cost added during November$410,000
Conversion cost added during November$234,500
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Required:
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1. Assume that the company uses the weighted-average method of accounting for units and costs. Determine the equivalent units for November for the first process.
300,000 (units started into production) + 80,000 (WIP, Nov.1) = 380,000
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2. Compute the costs per equivalent unit for November for the first process.
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3. Determine the total cost of ending work in process inventory and the total cost of units transferred to the next process in November.
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ACC2233 Hand-In Assignment 5 QUESTION ONE: Equivalent Units and Cost per Equivalent Unit—Weighted-Average Method Grand River Company produces a high-quality insulation material that passes through two production processes. Data for November for the first process follow: Completion Completion with Respect with Respect Units to materials to Conversion Work in process inventory, November 1 . ..... 80,000 50% 25% Work in process inventory, November 30. .... 60,000 45% 20% Materials cost in work in process Inventory, November 1 $76,600 Conversion cost in work in process Inventory, November 1 $34,900 Units started into production 300,000 Units transferred to the next process 320,000 Materials cost added during November $410,000 Conversion cost added during November $234,500 Required: 1. Assume that the company uses the weighted-average method of accounting for units and costs. Determine the equivalent units for November for the first process. 2. Compute the costs per equivalent unit for November for the first process. 3. Determine the total cost of ending work in process inventory and the total cost of units transferred to the next process in November. QUESTION TWO: Equivalent Units; Applying Costs—Weighted-Average Method The Wire One Company manufactures high-quality coated electrical wire in two departments, Weaving and Coating. Materials are introduced at various points during work in the Weaving Department. After the weaving is completed, the materials are transferred into the Coating Department, where specialty plastic coating is applied. Selected data relating to the Weaving Department during May are given below:
Production data: Kilograms in process, May 1: Materials 100% complete, conversion 80% complete . ............................. 85,000 Kilograms started into production during May. ................ 365,000 Kilograms completed and transferred to Coating. ........... ? Kilograms in process, May 31: Materials 65% complete, conversion 30% complete . ...................................... 50,000 Cost data: Work in process inventory, May 1: Materials cost . ............................................... $101,000 Conversion cost. ................................................. $51,000 Cost added during May: Materials cost . ............................................... $462,000 Conversion cost . ............................................... $213,000 The company uses the weighted-average method. Required: 1. Compute the equivalent units of production. 2. Compute the costs per equivalent unit for May. 3. Determine the cost of ending work in process inventory and of the units transferred to the Coating Department. 4. Prepare a cost reconciliation between the costs determined in (3) above and the cost of beginning inventory and costs added during the period (May have a rounding difference).
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Posted 18 Dec 2017 09:12 AM
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