Question

EX 20-11 Equivalent units of production and related costs The charges to Work in Process Assembly Department for a period, together with infor mation concerning production, are as follows. All direct materials are placed in process at the beginning of production. Work in Process- Assembly Department Bal., 5,000 units, 35% completed 10,475 To Finished Goods, 105,500 units Direct materials, 108,000 units @ $1.50 162,000 Direct labor 145,300 Factory overhead 47,525 Bal.? units, 45% completed Determine the following: a. The number of units in work in process inventory at the end of the period. b. Equivalent units of production for direct materials and conversion C. Costs per equivalent unit for direct materials and conversion d. Cost of the units started and completed during the period.

Answer 1

Requirement a:

Units in process at beginning of period	5,000
Units placed in production during period	108,000
Less units: Finished during period	-105,500
Units in process at ending of period	7,500

Requirement b:

	Percent Completed This Period	Whole units	Equivalent units
			Direct materials	Conversion
Inventory in process, beginning	65%	5,000	5,000	3,250
Started and completed [108,000-7,500]		100,500	100,500	100,500
Transferred to finished goods		105,500	105,500	103,750
Inventory in process, ending	45%	7,500	7,500	3,375
Total units		113,000	113,000	107,125

Requirement c:

	Costs
	Direct materials	Conversion
Total costs for period in Assembly Department	$162,000	$192,825
Divided by total equivalent units (from above)	113,000	107,125
Cost per equivalent unit	$1.43	$1.80

Requirement d:

Cost of the units started and completed during the period:
Direct materials unit cost	$1.43
Conversion unit cost	$1.80
Total unit cost	$3.23
x Units started and completed	100,500
Cost of units started and completed	$324,615