Question

#12

Required information The following information applies to the questions displayed below) 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 35,000 units in Inventory, 60% complete as to materials and 40% complete as to conversion costs. The beginning inventory cost of $80,100 consisted of $56,800 of direct materials costs and $23,300 of conversion costs. During the month, the forming department started 500,000 units. At the end of the month, the forming department had 40,000 units in ending inventory. 90% 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 Direct materials added during the month Conversion added during the month $ 89,180 1,828,250 1,192,880

Answer 1

1) Equivalent unit

Equivalent unit of material (495000+40000*90%)	531000
Equivalent unit of conversion (495000+40000*40%)	511000

2) Cost per equivalent unit

Direct material (56800+1828250)/531000	3.55
Conversion (23300+1192880)/511000	2.38

3) Cost report

Cost assignment and reconciliation
Cost of units transferred out	EUP	Cost per EUP	Total cost
Direct materials	495000	3.55	1757250
Conversion	495000	2.38	1178100
Total costs transferred out				2935350
Cost of ending work in process	EUP	Cost per EUP	Total cost
Direct material	36000	3.55	127800
Conversion	16000	2.38	38080
Total cost of ending work in process				165880
Total cost assigned				3101230