Question

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Silver Company manufactures kites and has the following information available for the month of April:

Work in process, April 1
(100% complete for materials, 40% for conversion)		58,000	units
Direct materials	$	86,000
Conversion cost	$	116,000
Number of units started		164,000	units
April costs
Direct materials	$	232,000
Conversion cost	$	342,000
Work in process, April 30
(100% complete for materials, 20% for conversion)		83,000	units

Required:

Using the weighted-average method, complete each of the following steps:

1. Reconcile the number of physical units worked on during the period.

2. Calculate the number of equivalent units.

3. Calculate the cost per equivalent unit.

4. Reconcile the total cost of work in process.

Answer 1

Solution 1:

Reconciliation of Physical units
Particulars	Physical Units	Particulars	Physical Units
Beginning units	58000	Unit Completed	139000
Unit started	164000	Ending Units	83000
Total Units	222000	Total Units	222000

Solution 2:

Silver Company
Computation of Equivalent unit of Production
Particulars	Physical Units	Material	Conversion
Units to account for:
Beginning WIP	58000
Started into Production	164000
Total units to account for	222000
Units accounted for:
Unit completed & Transferred out	139000	139000	139000
Units in ending inventory:	83000
Material (100%)		83000
Conversion (20%)			16600
Equivalent units of production	222000	222000	155600

solution 3:

Silver Company Computation of Cost per equivalent unit
Particulars	Material	Conversion	Total
Opening WIP	$86,000	$116,000	$202,000
Cost Added during Period	$232,000	$342,000	$574,000
Total cost to be accounted for	$318,000	$458,000	$776,000
Equivalent units of production	222000	155600
Cost per Equivalent unit	$1.4324	$2.9434
Costs accounted for as follows:
Cost of unit transferred out	$199,108	$409,139	$608,247
Ending Work In Process	$118,892	$48,861	$167,753
Total costs accounted for	$318,000	$458,000	$776,000

solution 4:

Silver Company Computation of Cost of ending WIP and units completed & transferred out
Particulars	Material	Conversion	Total
Equivalent unit of Ending WIP	83000	16600
Cost per equivalent unit	$1.4324	$2.9434
Cost of Ending WIP (Equivalent unit * Cost per equivalent unit)	$118,892	$48,861	$167,753
Units completed and transferred	139000	139000
Cost of units completed & Transferred (Unit completed * cost per equivalent unit)	$199,108	$409,139	$608,247

Cost reconciliation - Silver Company
Particulars	Amount
Costs to be accounted for:
Cost of beginning WIP inventory	$202,000.00
Cost added to production	$574,000.00
Total Costs to be accounted for	$776,000.00
Costs accounted for as follows:
Cost of unit transferred out	$608,247
Ending WIP:
Material	$118,892
Converison	$48,861
Total Ending WIP	$167,753
Total costs accounted for	$776,000