Question

Weston Products manufactures an industrial cleaning compound that goes through three processing departments—Grinding, Mixing, and Cooking. All raw materials are introduced at the start of work in the Grinding Department. The Work in Process T-account for the Grinding Department for May is given below: ? Work in Process-Grinding Department Inventory, May 1 309,880 Completed and transferred to the Mixing Department Materials 580,000 Conversion 375, 371 Inventory, May 31 ? The May 1 work in process inventory consisted of 127,000 pounds with $181,610 in materials cost and $128,270 in conversion cost. The May 1 work in process inventory was 100% complete with respect to materials and 30% complete with respect to conversion. During May, 352,000 pounds were started into production. The May 31 inventory consisted of 111,000 pounds that were 100% complete with respect to materials and 70% complete with respect to conversion. The company uses the weighted-average method in its process costing system. Required: 1. Compute the Grinding Department's equivalent units of production for materials and conversion in May. 2. Compute the Grinding Department's costs per equivalent unit for materials and conversion for May. 3. Compute the Grinding Department's cost of ending work in process inventory for materials, conversion, and in total for May. 4. Compute the Grinding Department's cost of units transferred out to the Mixing Department for materials, conversion, and in total for May.

Answer 1

Unit completed and transferred out = 127,000+352,000-111,000 = 368,000

1) Equivalent unit of production

	EUP-Material	EUP-Conversion
Units transferred out	368,000	368,000
Ending work in process	111,000	111,000*70% = 77,700
Equivalent unit of production	479,000	445,700

2) Cost per equivalent unit

	Material	Conversion
Beginning work in process	181,610	128,270
Cost added	580,000	375,371
Total Cost	761,610	503,641
Equivalent unit	479,000	445,700
Cost per equivalent unit	1.59	1.13

3) Cost of ending work in process

	Material	Conversion	total
Cost of ending work in process	111,000*1.59 = 176,490	77,700*1.13 = 87,801	264,291

4) Cost of units transferred out

	Material	Conversion	Total
Cost of units transferred out	368,000*1.59 = 585,120	368,000*1.13 = 415,840	1,000,960

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