Question

Sunspot Beverages, Ltd., of Fiji uses the weighted-average method in its process costing system. It makes blended tropical fruit drinks in two stages. Fruit juices are extracted from fresh fruits and then blended in the Blending Department. The blended juices are then bottled and packed for shipping in the Bottling Department. The following information pertains to the operations of the Blending Department for June.

		Percent Completed
	Units	Materials	Conversion
Work in process, beginning	108,000	70%	40%
Started into production	511,500
Completed and transferred out	501,500
Work in process, ending	118,000	75%	25%

	Materials		Conversion
Work in process, beginning	$	46,800	$	17,400
Cost added during June	$	501,900	$	370,230

Required:

1. Calculate the Blending Department's equivalent units of production for materials and conversion in June.

2. Calculate the Blending Department's cost per equivalent unit for materials and conversion in June.

3. Calculate the Blending Department's cost of ending work in process inventory for materials, conversion, and in total for June.

4. Calculate the Blending Department's cost of units transferred out to the Bottling Department for materials, conversion, and in total for June.

5. Prepare a cost reconciliation report for the Blending Department for June.

Answer 1

	Beginning work in process			108,000	Completed & transferred			501,500
	started during the year			511,500	Ending work in process			118,000
	units to account for			619,500	units accounted for			619,500
1)	Equivalent units of production
				units	%mat	Materials	%CC	CC
	Completed & transferred			501,500	100%	501,500	100%	501,500
	Ending work in process			118,000	75%	88,500	25%	29,500
	Equilvalent units of production					590,000		531,000	answer
2)	Cost per Equivalent units
					Materials	CC	total
	work in process,beginning				46,800	17,400	64,200
	cost added during June				501,900	370,230	872,130
	tota cost (A)				548,700	387,630	936,330
	Equivalent units (B)				590,000	531,000
	cost per unit c=a/b				0.93	0.73	1.66	answer
3)	Cost of ending work in process
	Materials	)88500*.93(		82305
	CC	(29500*.73)		21535
	total cost of Ending work in process				103840
4)	Cost of units transferred out
	Materials	(501500*.93)		466395
	CC	(501500*.73)		366095
	Cost of units transferred out				832490
5)	Cost Reconciliation Report
	cost to be accounted
	Beginning work in process				64,200
	cost added during the year				872,130
	cost to be accounted				936,330
	cost accounted for
	cost of ending work in process				103840
	cost of units transferred out				832490
	cost accounted for				936330