Question

Helix Corporation uses the weighted-average method in its process costing system. It produces prefabricated flooring in a series of steps carried out in production departments. All of the material that is used in the first production department is added at the beginning of processing in that department. Data for May for the first production department follow: Percent Complete Units Materials Conversion Work in process inventory, May 1 71,000 100 % 30 % Work in process inventory, May 31 51,000 100 % 20 % Materials cost in work in process inventory, May 1 $ 56,700 Conversion cost in work in process inventory, May 1 $ 16,800 Units started into production 260,600 Units transferred to the next production department 280,600 Materials cost added during May $ 125,680 Conversion cost added during May $ 242,012 Required: 1. Calculate the first production department's equivalent units of production for materials and conversion for May. 2. Compute the first production department's cost per equivalent unit for materials and conversion for May. 3. Compute the first production department's cost of ending work in process inventory for materials, conversion, and in total for May. 4. Compute the first production department's cost of the units transferred to the next production department for materials, conversion, and in total for May.

Answer 1

Answer

• All working forms part of the answer
• Amounts are in $, except units
• Requirement 1: Equivalent no. of units

Statement of Equivalent Units
Opening WIP	71000
Introduced	260600	Equivalent Units for--
TOTAL	331600	material cost	conversion cost
Transferred	280600	280600 [100%]	280600 [100%]
Closing WIP	51000	51000 [100%]	10200 [20%]
TOTAL equivalent units		331600 units for material	290800 units for Conversion cost

• Requirement 2: Cost per Equivalent Unit

Cost per Equivalent Units
COST	material cost	conversion cost	TOTAL
Opening WIP	$56700	$16800	$73500
Current cost	$125680	$242012	$367692
TOTAL	$182380	$258812	$441192
Total Equivalent Units [calculated above]	331600	290800
Equivalent Cost/unit	$0.550	$0.890	$1.440

• Requirement 3 & 4: Cost of Ending WIP and cost of Units transferred

Statement of cost
Cost	Cost/unit	Closing WIP		Transferred
		Equivalent Units	Cost Allocated	Equivalent Units	Cost Allocated
material cost	$0.550	51000	$28050	280600	$154330
conversion cost	$0.890	10200	$9078	280600	$249734
Total	$1.440		0		0
		TOTAL	$37128 (Answer 3)	TOTAL	$404064 (Answer 4)