Question

At Panther Company, materials are added at the beginning of the process and conversion costs are added uniformly. Work in process, beginning: Number of units 9,000 Transferred-in costs $94,000 Direct materials (100%) $22,500 Conversion costs (75%) $25,400 Unitstransferred-in: Number of units 47,500 Transferred-in costs $640,500 Units completed 43,000 Costs during the period: Direct materials $155,475 Conversion costs $213,225 Work in process, ending: Number of units 13,500 (100% complete for materials and 35% complete for conversion) The total cost of units transferred out to finished goods is closest to A) $1,004,625. B) $1,151,100. C) $ 909,450. D) $ 350,450.

Answer 1

	Transferred-in	Materials	Conversion
Units completed and transferred out	43000	43000	43000
Work in process, ending	13500	13500	4725
Equivalent units of production	56500	56500	47725
	Transferred-in	Materials	Conversion
Work in process, beginning	94000	22500	25400
Cost added during period	640500	155475	213225
Total costs	734500	177975	238625
Divide by Equivalent units of production	56500.0	56500	47725
Cost per Equivalent unit	13.00	3.15	5.00
	Transferred-in	Materials	Conversion	Total
Units completed and transferred out	43000	43000	43000
X Cost per Equivalent unit	13.00	3.15	5.00
Cost of Units transferred out to finished goods	559000	135450	215000	909450
Option C $ 909,450 is correct