Question

ACC 321 BBAs3 Problem (chapter 17) Honeybutter, Inc., manufactures a product that goes through two departments prior to completion. The following information is available on work in the mixing department during June. Amount Completed Materials Conversion 317 Units Work in process, June 1 .......... 70,000 Started into production ........... 460,000 Completed and transferred out ..... 450,000 Work in process, June 30 ......... 80,000 5/7 3/4 5/8 Cost in the beginning work in process inventory and cost added during June were as follows: Work in process, June 1 ..... Cost added during June ...... Materials $ 35,000 391,000 Conversion $ 17,000 282,000 The company uses the weighted-average method to compute unit costs. The mixing de- partment is the first department in the production process; after mixing has been completed, the units are transferred to the bottling department. a) Determine the equivalent units for both material & conversion costs (in good form). b) Get the costs to account for, for both material & conversion costs (in good form). c) Calculate the costs per equivalent unit for both costs. d) What did it cost to make a unit during June? e) Prepare the journal entry for units completed in June. f) Justify the ending balance for Work-in Process inventory at June 30. g) Would you have gotten the same answer for d) if we had used the FIFO method? Why?

Answer 1

a) Equivalent units = Units transferred + Ending WIP x Completion
Materials = 450000 + 80000 x3/4 = 510000 units
Conversion = 450000 + 80000 x5/8 = 500000 units

b)

Costs to account for
Beginning Balance, Work in Process	$          52,000
Direct Material	$       3,91,000
Conversion costs	$       2,82,000
Total Costs to account for	$      7,25,000

c) Cost per unit = (Beginning Cost + Cost added) / Equivalent units
Material = ($35000+391000)/510000 = $0.84 per unit
Conversion = ($17000+282000)/500000 = $0.60 per unit or $0.598 per unit

d) Cost to make one unit = $0.84+$0.60 = $1.44 or $1.43 per unit

A s per HOMEWORKLIB RULES we are required to answer 4 parts, i have answered 4, so kindly post others separately