Question

Superior Micro Products uses the weighted average method in its process costing system. During January, the Delta Assembly Department completed its processing of 26,400 units and transferred them to the next department. The cost of beginning work in process inventory and the costs added during January amounted to $704,370 in total. The ending work in process inventory in January consisted of 3.800 units, which were 70% complete with respect to materials and 50% complete with respect to labor and overhead. The costs per equivalent unit for the month were as follows: Cost per equivalent unit Materials $14.50 Labor $ 3.50 Overhead $ 6.50 Required: 1. Compute the equivalent units of materials, labor, and overhead in the ending work in process inventory for the month. 2. Compute the cost of ending work in process inventory for materials, labor, overhead, and in total for January. 3. Compute the cost of the units transferred to the next department for materials, labor, overhead, and in total for January 4. Prepare a cost reconciliation for January. (Note: You will not be able to break the cost to be accounted for into the cost of beginning work in process inventory and costs added during the month.) Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Compute the equivalent units of materials, labor, and overhead in the ending work in process inventory for the month. Materials Labor Overhead Equivalent units < Prey 5 of 5 Next >

Answer 1

Ans.

1. Compute the equivalent units of materials, labor, and overhead in the ending work in process inventory for the month.

	Whole unit	%	EUP-material	%	Eup-Labour	%	EUP-overhead
Ending work in process	3800	70%	2660	50%	1900	50%	1900

	Material	Labour	overhead
Equivalent Units	2660	1900	1900

2.Calculate the cost of finishing work in process inventory format, work, overhead and overall for January.

	Material	Labour	Overhead	Total
Cost of ending work in process inventory	2,660*$14.50 = $38,570	1,900*$3.50 = $6,650	1,900*$6.50 = $12,350	$57,570.00

3.Calculate the cost of the units transferred to the next department for materials, labor, overhead and in total for January.

	Material	Labour	Overhead	Total
Cost of units completed and transferred out	2,660*$14.50 = $382,800	26,400*$3.50 = $92,400	26,400*$6.50 = $171,600	$646,800.00

4.Prepare a reconciliation of costs for January.

Cost to be accounts for
Cost of beginning work in process and cost added	$ 704,370.00
Total cost to be accounted for	$ 704,370.00
Cost accounted as
Cost of units transferred out	$ 646,800.00
Cost of ending work in process	$ 57,570.00
Total cost accounted as	$ 704,370.00