Question

McElroy, Inc., produces a single model of a popular cell phone in large quantities. A single cell phone moves through two departments, assembly and testing. The manufacturing costs in the assembly department during March follow:

Direct materials	$	176,900
Conversion costs		140,450
	$	317,350

The assembly department has no beginning Work-in-Process Inventory. During the month, it started 29,000 cell phones, but only 24,000 were fully completed and transferred to the testing department. All parts had been made and placed in the remaining 5,000 cell phones, but only 50% of the conversion had been completed. The company uses the weighted-average method of process costing to accumulate product costs.

Required:

1. Compute the equivalent units and costs per equivalent unit for March in the assembly department.

2. Compute the cost of units completed and transferred to the testing department.

3. Compute the cost of the ending Work-in-Process.

Required 1 Required 2 Required 3 Compute the equivalent units and costs per equivalent unit for March in the assembly department. (Round "Costs per equivalent unit" to 2 decimal places.) Direct Materials Conversion Equivalent units Costs per equivalent unit < Required 1 Required 2 > Required 1 Required 2 Required 3 Compute the cost of units completed and transferred to the testing department. (Round intermediate calculations to 2 decimal places.) Cost of units completed and transferred out Required 1 Required 3 > Required 1 Required 2 Required 3 Compute the cost of the ending Work-in-process. (Round intermediate calculations to 2 decimal places.) Cost of the ending work-in-process < Required 2 Required 3 >

Answer 1

Solution

	Material	Conversion
Equivalent Units of Production	29,000	26,500
Cost per equivalent Unit	$                    6.10	$                   5.30

.

Units completed and Transferred out

$       273,600.00

.

Cost of Ending Work in process inventory

$          43,750.00

Working

Statement of Equivalent Units(Weighted average)
				Material		Conversion cost
	Units			Complete %	Equivalent units	Complete %	Equivalent units
Transferred out	24,000			100%	24,000	100%	24,000
Ending WIP	5,000			100%	5,000	50%	2,500
Total	29,000			Total	29,000	Total	26,500

.

Cost per Equivalent Units (Weighted average)
COST		Material	Conversion cost	TOTAL
Beginning WIP Inventory Cost				$ 0
Cost incurred during period		$ 176,900	$ 140,450	$ 317,350
Total Cost to be accounted for		$ 176,900	$ 140,450	$ 317,350
Total Equivalent Units		29,000	26,500
Cost per Equivalent Units		$                   6.10	$                     5.30	$             11.40

.

Statement of cost (Weighted average)
Cost	Equivalent Cost/unit	Ending WIP		Transferred
		Units	Cost Allocated	Units	Cost Allocated
Material	$ 6.10	5,000	$          30,500.00	24,000	$ 146,400
Conversion cost	$ 5.30	2,500	$          13,250.00	24,000	$ 127,200
TOTAL	$ 317,350	TOTAL	$ 43,750	TOTAL	$ 273,600