Question

(The following information applies to the questions displayed below.) Legacy Company manufactures umbrellas and has the following information available for the month of May: Work in process, May 1 (100% complete for materials, 90% for conversion) Direct materials Conversion cost 36,300 units $ 64,800 $ 87,800 Number of units started 90,800 units May costs Direct materials Conversion cost $ 103,300 $ 189,800 Work in process, May 31 (100% complete for materials, 20% for conversion) 33,800 units Required: Using the weighted average method of process costing, complete each of the following steps: 1. Reconcile the number of physical units worked on during the period. 2. Calculate the number of equivalent units. 3. Calculate the cost per equivalent unit. 4. Reconcile the total cost of work in process.

Answer 1

1.

Units completed = 36,300 + 90,800 - 33,800 = 93,300

	Physical units			Physical units
Beginning units	36,300		Units completed	93,300
Units started	90,800		Ending units	33,800
Total units	127,100		Total units	127,100

2.

Conversion ending units = 33,800 X 20% = 6,760

		Equivalent	Units
	Physical units	Direct material	Conversion
Units completed	93,300	93,300	93,300
Ending inventory	33,800	33,800	6,760
Total units	127,100	127,100	100,060

3.

Cost per equivalent units = (Beginning cost + May cost) / Equivalent units

	Direct material	Conversion
Cost per equivalent unit	$1.32258	$2.77434

4.

	Direct material	Conversion	Total cost
Units completed	$123,397	$258,846	$382,243
Ending inventory	$44,703	$18,754	$63,457
Total cost accounted for	$168,100	$277,600	$445,700