Question

Baden Company has gathered the following information.

Units in beginning work in process		0
Units started into production		37,000
Units in ending work in process		7,500
Percent complete in ending work in process:
Conversion costs		40	%
Materials		100	%
Costs incurred:
Direct materials		$77,700
Direct labor		$62,400
Overhead		$106,600

Compute equivalent units of production for materials and for conversion costs.

		Materials		Conversion Costs
The equivalent units of production

Determine the unit costs of production. (Round unit costs to 2 decimal places, e.g. 2.25.)

		Materials		Conversion Costs
Unit costs		$		$

Show the assignment of costs to units transferred out and in process.

Units transferred out		$
Units in ending work in process		$

Answer 1

Answers

• Requirement [1]

	Material	Conversion
Equivalent units of production	37,000	32,500

--Working

EUP - Weighted Average Method	Units	% Material	EUP Materials	% Conversion	EUP - Conversion
Units TRANSFERRED	29,500	100%	29,500	100%	29,500
Units of ENDING WIP	7,500	100%	7,500	40%	3,000
Equivalent Units of Production			37,000		32,500

• [2]

	Material	Conversion
Cost per Equivalent units	$                         2.10	$                              5.20

COST per EUP			Material		Conversion
Cost of Beginning WIP			$                          -		$                                                 -
Cost incurred during the period			$          77,700.00		$                                169,000.00
Total Costs		Costs	$          77,700.00	Costs	$                                169,000.00
Equivalent units of production		EUP	37,000	EUP	32,500
Cost per EUP			$              2.10000		$                                      5.20000

• [3]

Units transferred out = $ 215,350

	Material	Conversion	Total
Cost of units completed & transferred out	$               61,950.00	$                 153,400.00	$                     215,350.00

Units in ending WIP = $ 31350

	Material	Conversion	Total
Cost of ending WIP Inventory	$               15,750.00	$                    15,600.00	$                       31,350.00

Cost of Units Transferred Out	EUP	Cost per EUP	Total Cost
- Direct Materials	29,500	$                      2.10	$          61,950.00
- Conversion	29,500	$                      5.20	$        153,400.00
Total Cost transferred Out				$            215,350.00
Cost of ending WIP	EUP	Cost per EUP	Total Cost
- Direct Materials	7,500	$                      2.10	$          15,750.00
- Conversion	3,000	$                      5.20	$          15,600.00
Total cost of ending WIP				$              31,350.00