Question

Cost of Units Completed and in Process

The charges to Work in Process—Assembly Department for a period, together with information concerning production, are as follows. All direct materials are placed in process at the beginning of production.

Work in Process—Assembly Department
Bal., 8,000 units, 50% completed	24,800	To Finished Goods, 184,000 units	?
Direct materials, 188,000 units @ $2.1	394,800
Direct labor	299,400
Factory overhead	116,400
Bal., ? units, 75% completed	?

Cost per equivalent units of $2.10 for Direct Materials and $2.20 for Conversion Costs.

a. Based on the above data, determine the different costs listed below.

If required, round your interim calculations to two decimal places.

1. Cost of beginning work in process inventory completed this period	$
2. Cost of units transferred to finished goods during the period	$
3. Cost of ending work in process inventory

Answer 1

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		Equivalent Units		Note	Answer
Units	Physical Units	Materials	Conversion
Units charged to production:
Beginning Inventory in process	8,000.00
Plus: Started production	188,000.00
Total physical units accounted for	196,000.00
Units to be assigned costs:
Beginning Inventory in process	8,000.00	-	4,000.00		Materials are introduced in the beginning so 100% is already completed for materials. So in this month 0% is completed. So Equivalent units are calculated as 8,000 * 00%. Similarly 50% is already completed for conversion. So in this month 50% is completed. So Equivalent units are calculated as 8,000 * 50%.
Started and completed in same month	176,000.00	176,000.00	176,000.00
Transferred to finished goods	184,000.00	176,000.00	180,000.00
Ending, Inventory in process	12,000.00	12,000.00	9,000.00		This is closing units multiplied by % of completion
Total units to be assigned costs:	196,000.00	188,000.00	189,000.00
Cost Information				Total
Costs per equivalent unit		2.10	2.20	4.30
Costs assigned to production
Beginning Inventory in process				24,800.00
Costs incurred in the month		394,800.00	415,800.00	810,600.00
Total costs accounted for				835,400.00
Costs allocated to completed and partially completed units
Beginning Inventory in process				24,800.00
To complete Beginning Inventory in process		-	8,800.00	8,800.00	This is Beginning Inventory in process * Costs per equivalent unit.	This is answer to 1.
Started and completed in same month		369,600.00	387,200.00	756,800.00	This is Started and completed in same month units * Costs per equivalent unit.
Transferred to finished goods		369,600.00	396,000.00	790,400.00	This is Transferred to finished goods units * Costs per equivalent unit.	This is answer to 2.
Ending, Inventory in process		25,200.00	19,800.00	45,000.00	This is Ending, Inventory in process * Costs per equivalent unit.	This is answer to 3.
Total costs assigned				835,400.00
Started and completed in the same month
Goods Finished in the month	184,000.00
Less: Beginning work in process	8,000.00
Started and completed in the same month	176,000.00