Question

Required information Problem 16-2A Weighted average: Cost per equivalent unit; costs assigned to products LO C2, C3 (The following information applies to the questions displayed below.) Victory Company uses weighted average process costing to account for its production costs. Conversion cost is added evenly throughout the process. Direct materials are added at the beginning of the first process. During November, the first process transferred 780,000 units of product to the second process. Additional information for the first process follows. At the end of November, work in process inventory consists of 184,000 units that are 60% complete with respect to conversion, Beginning work in process inventory had $375,960 of direct materials and $155,820 of conversion cost. The direct material cost added in November is $2,516,040, and the conversion cost added is $2,960,580. Beginning work in process consisted of 77,000 units that were 100% complete with respect to direct materials and 80% complete with respect to conversion. Of the units completed, 77,000 were from beginning work in process and 703,000 units were started and completed during the period. s were Problem 16-2A Part 1 Required: For the first process: 1. Determine the equivalent units of production with respect to direct materials and conversion Equivalent Units of Production (EUP)-Weighted Average Method Units % Materials EUP. Materials % Conversion EUP. Conversion Total units

Answer 1

	Requirement -1
		EUP - Weighted Average Method
		Units	% Materials	EUP-Material	% Conversion	EUP-Conversion
	Completed and Transferred Out	780000	100%	780,000	100%	780,000
	Ending Inventory	184000	100%	184,000	60%	110,400
				964,000		890,400
	Requirement -2
	Cost per equivalent unit of product			Materials		Conversion
	Beginning Inventory Costs			$375,960		$155,820
	Costs added			$2,516,040		$2,960,580
	Total costs		Costs	$2,892,000		$3,116,400
	Equivalent units of product		EUP	964,000		890,400
	Cost per equivalent unit of product			3.00		3.50
	Requirement - 3
	Cost of units transferred out:		EUP	Cost per EUP	Total cost
	Direct materials:		780,000	3.00	$2,340,000
	Conversion:		780,000	3.50	$2,730,000
	Total costs transferred out				$5,070,000
	Costs of ending work in process		EUP	Cost per EUP	Total cost
	Direct materials		184,000	3.00	$552,000
	Conversion		110,400	3.50	$386,400
	Total costs ending work in process				$938,400
	Total costs accounted for				$6,008,400

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