Question

Jordana Woolens is a manufacturer of wool cloth. The information of March is as follows:

Beginning work in progress 10,000 units

Units started 20,000 units

units completed 25,000 units

Beginning work-in-process Direct Materials $6,000

Beginning work-in-process conversion $2,600

Direct materials added during month $30,000

Direct manufacturing labor during month $12,000

Factory overhead $5,000

Beginning work in process was half converted as to labor and overhead. Direct materials are added at the beginning of the process. All conversion costs are incurred evenly throughout the process. Ending work in process was 60% complete.

Required:

Using weighted-average method, calculate the following:

1. Equivalent units for material costs

2. Equivalent units for conversion costs

3. Material cost per equivalent unit

4. Conversion cost per equivalent unit

5. Total costs transferred out

6. Cost of material and conversion in ending WIP

Answer 1

1&2

	Physical units	Direct y	Conversion
Work in process, Beginning	10,000
Started during the period	20,000
To account for	30,000
Units completed	25,000	25,000	25,000
Work-in-process, Ending	5,000	5,000	3,000
Accounted for	30,000	30,000	28,000

3&4

	Direct materials	Conversion	Total cost
Work-in-process, Beginning	$6,000	$2,600	$8,600
Cost added during period	$30,000	$17,000	$47,000
Total cost account for	$36,000	$19,600	$55,600
÷ Equivalent units	30,000	28,000
Equivalent unit cost	$1.20	$0.70	$1.90

5&6

Assignment of costs
Cost transferred out (25,000×$1.90)	$47,500
Work-in-process, Ending
Direct materials (5,000×$1.20)	$6,000
Conversion (5,000×$0.70×60%)	$2,100
Costs account for	$55,600

____×____

All the best