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 31,000 units in inventory, 70% complete as to materials and 30% complete as to conversion costs. The beginning inventory cost of $72,100 consisted of $52,000 of direct materials costs and $20,100 of conversion costs.

During the month, the forming department started 420,000 units. At the end of the month, the forming department had 40,000 units in ending inventory, 80% complete as to materials and 30% 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	$	72,100
Direct materials added during the month		1,631,400
Conversion added during the month		1,079,700

Exercise 20-6 Weighted average: Cost per EUP and costs assigned to output LO C2

1.
Calculate the equivalent units of production for the forming department.
Direct materials-

conversion-

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

conversion-

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.

Cost Assignment and Reconciliation Cost of units transferred out Direct materials Cost per EUP Total cost Conversion U Total costs transferred out Costs of ending work in process Direct materials Conversion Total cost of ending work in process Total costs assigned Cost per EUP 0.00 0.00 Total cost 0.00 0.00

Answer 1

1) Equivalent unit

Direct material = 411000+(40000*80%) = 443000

Conversion = 411000+(40000*30%) = 423000

2) Cost per equivalent unit

Direct material = (52000+1631400)/443000 = 3.8

Conversion = (20100+1079700)/423000 = 2.6

3) Cost reconciliation

Cost assignment and reconciliation
Cost of units transferred out	EUP	Cost per EUP	Total Cost
Direct material	411000	3.8	1561800
Conversion	411000	2.6	1068600
Total Cost transferred out				2630400
Cost of ending WIP	EUP	Cost per EUP	Total Cost
Direct material	32000	3.8	121600
Conversion	12000	2.6	31200
Total Cost of ending WIP				152800
Total Cost assigned				2783200