Question

Problem 4-14 Analysis of Work in Process T-account-Weighted-Average Method [LO4-1, L04-2, 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: Inventory, May 1 Work in Process-Grinding Department 309,880 Completed and transferred to the Mixing Department 580,000 375, 371 Materials Conversion 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

1) Equivalent unit

	Material	Conversion
Unit transferred out	368000	368000
Ending WIP	111000	111000*70% = 77700
Equivalent unit	479000	445700

2) Cost per equivalent unit

	Material	Conversion
Beginning WIP	181610	128270
Cost added	580000	375371
Total Cost	761610	503641
Equivalent unit	479000	445700
Cost per equivalent unit	1.59	1.13

3) Cost of ending WIP

	Material	Conversion	Total
Cost of ending WIP	111000*1.59 = 176490	77700*1.13 = 87801	264291

4) Cost of unit transferred out

	Material	Conversion	Total
Cost of unit transferred out	368000*1.59 = 585120	368000*1.13 = 415840	1000960