Problem 414 Analysis of Work in Process TaccountWeightedAver

Problem 4-14 Analysis of Work in Process T-account-Weighted-Average Method [LO4-1, LO4-2, LO4-3, LO4-4]

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:

The May 1 work in process inventory consisted of 49,000 pounds with $64,190 in materials cost and $39,200 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, 479,000 pounds were started into production. The May 31 inventory consisted of 126,000 pounds that were 100% complete with respect to materials and 60% 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.

Work in Process—Grinding Department
Inventory, May 1	103,390	Completed and transferred to the Mixing Department	?
Materials	711,970
Conversion	400,192
Inventory, May 31	?

Solution

UNITS TO ACCOUNT FOR: Beginning Work in Process units 49,000 Add: Units Started in Process 479,000 Total Units to account for: 528,000 UNITS TO BE ACCOUNTED FOR: Units started and completed 402,000 Ending Work in Process 126,000 Total Units to be accounted for: 528,000 Equivalent Units: Material Cost Conversion % Completion Units % Completion Units Units started and completed 100% 402,000 100% 402,000 Ending Work in Process 100% 126,000 60% 75,600 Total Equivalent units 528,000 477,600 TOTAL COST TO ACCOUNT FOR: Material Conversion Beginning work in Process 64,190 39,200 Cost Added during May 711,970 400,192 Total Cost to account for: 776,160 439,392 Total Cost to account for: 1,215,552 COST PER EQUIVALENT UNIT: Material Conversion Total cost added during the year 776,160 439,392 Equivalent Units 528,000 477,600 Cost per Equivalent unit 1.47 0.92 TOTAL COST ACCOUNTED FOR: Units started and Transferred out (402000 units) Equivalent unit Cost per EU Total Cost Material 402,000 1.47 590940 Conversion Cost 402,000 0.92 369840 Total Cost of Units completed and transferred out: 960780 Ending Work in process (126,000 units) Equivalent unit Cost per EU Total Cost Material 126,000 1.47 185220 Conversison Cost 75,600 0.92 69552 Total cost of Ending Work in process: 254,772 Req 1. Material Conversion Equivalent units 528000 477600 Req 2: Material Conversion Cost per unit 1.47 0.92 Req 3: material Conversion Total Cost of Ending inventory 185220 69552 254772 Req 4 material Conversion Total Cost of tranefrred out units 590940 369840 960780