Question

HW 4 Saved Help Cooperative San José of southern Sonora state in Mexico makes a unique syrup using cane sugar and local herbs. The syrup is sold in small bottles and is prized as a flavoring for drinks and for use in desserts. The bottles are sold for $12 each. The first stage in the production process is carried out in the Mixing Department, which removes foreign matter from the raw materials and mixes them in the proper proportions in large vats. The company uses the weighted-average method in its process costing system 8 points A hastily prepared ept for the Mixing Department for April appears below: Units to be accounted for: eBook work in process, April 1 (materials 90% complete ; conversion 80% complete) 5,500 29,600 35,100 Started into production Total units to be accounted for Units accounted for as follows: Transferred to next department Print 25,100 Work in process, April 30 (materials 80% complete ; 10,000 35,100 conversion 50% complete) References Total units accounted for Cost Reconciliation Cost to be accounted for: $ 18,095 100,746 $118,841 Work in process, April 1 Cost added during the month Total cost to be accounted for Cost accounted for as follows: Work in process, April 30 $ 25,720 Transferred to next department93,121 Total cost accounted for $ 118,841

Answer 1

UNITS TO ACCOUNT FOR:
Beginning Work in Process units				5,500
Add: Units Started in Process				29,600
Total Units to account for:				35,100
UNITS TO BE ACCOUNTED FOR:
Units completed				25,100
Ending Work in Process				10,000
Total Units to be accounted for:				35,100
Equivalent Units:
			Material Cost		Conversion
			% Completion	Units	% Completion	Units
Units completed			100%	25,100	100%	25,100
Ending Work in Process			80%	8,000	50%	5,000
Total Equivalent units				33,100		30,100
TOTAL COST TO ACCOUNT FOR:
			Material		Conversion
Beginning work in Process			12,045		6,050
Cost Added during May			67,064		33,682
Total Cost to account for:			79,109		39,732
Total Cost to account for:					118,841
COST PER EQUIVALENT UNIT:
			Material		Conversion
Total cost added during the year			79,109		39,732
Equivalent Units			33,100		30,100
Cost per Equivalent unit			2.39		1.32
Req 1.
			Material	Conversion
Equivalent unit			33100	30100
Req 2.
			Material	Conversion
Cost per eqiv. Units			2.39	1.32
Req 3.
Total Units completed				25100
Less: Units completed from beg. WIP				5500
Units started and completed				19600
Req 4.
No, The lesser cost is mainly due to average cost applied which takes in to consideration the cost of previous year as well incurred in beginning work in process.
The cost of previous year was at lower prices and therefore, the average cost comes out at lower rate than actual price of material today.