Question

3 [The following information applies to the questions displayed below. Fields Company has two manufacturing departments, forming and painting. The company uses the weighted-average method of process costing. At the beginning of the month, the forming department has 28,000 units in inventory, 70% complete as to materials and 30% complete as to conversion costs. The beginning inventory cost of $67,100 consisted of $49,000 of direct materials costs and $18,100 of conversion costs. 1 points During the month, the forming department started 370,000 units. At the end of the month, the forming department had 40,000 units in ending inventory, 85% complete as to materials and 45% complete as to conversion. Units completed in the forming department are transferred to the painting department. eBook Cost information for the forming department follows. Hint $ Beginning work in process inventory Direct materials added during the month Conversion added during the month 67,100 1,440,600 997, 100 Print References Exercise 20-6 Weighted average: Cost per EUP and costs assigned to output LO C2 1. Calculate the equivalent units of production for the forming department. 2. Calculate the costs per equivalent unit of production for the forming department. 3. Using the weighted average method, assign costs to the forming department's output-specifically, its units transferred to painting and its ending work in process inventory. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Calculate the equivalent units of production for the forming department. Direct Materials Conversion

Answer 1

Solution :

Requirement 1: Computation of equivalent units of production

Statement of equivalent production for the Forming department

Particulars	Output units	Equivalent production
Materials	Conversion costs
%	Units **	%	Units **
Completed units ( working note 1)	3,58,000	100%	3,58,000 (3,58,000*100%	100%	3,58,000 (3,58,000 units*100%)
Work in process inventory	40,000	85%	34,000 (40,000 units*85%)	45%	18,000 (40,000 units*45%)
	3,98,000		3,92,000		3,76,000

% shows percentage of completion.                     ** equivalent units

Working Note 1:

Number of Units Completed shall be computed as below:

Particulars	Number of units
Opening inventory	28,000 units
Add: Started units	3,70,000 units
Less: Closing inventory	(40,000 units )
Completed units	3,58,000 units

Requirement 2: Statement showing cost per equivalent unit of production for the Forming department:

Particulars	Materials	Conversion cost	Total
Cost of beginning work in process	$ 49,000	$ 18,100	$ 67,100
Cost incurred during the month	$ 14,40,600	$ 9,97,100	$ 24,37,700
Total cost (A)	$ 14,89,600	$ 10,15,200	$ 25,04,800
Equivalent units (B) [ EUP]	3,92,000	3,76,000
Cost per EUP: C= (A /B )	$ 3.80	$ 2.70	$ 6.50

Requirement 3:

Cost assignment and reconciliation
Cost of units transferred out	EUP (D)	Cost per EUP (F)	Total cost in $ G = (D) * (F)
Direct materials	3,58,000 units	$ 3.80	$ 13,60,400
Conversion	3,58,000 units	$ 2.70	$ 9,66,600
Total costs transferred out to Painting		$ 23,27,000
Cost of ending work in process	EUP	Cost per EUP	Total cost
Direct materials	34,000 units	$ 3.80	$ 1,29,200
Conversion	18,000 units	$ 2.70	$ 48,600
Total cost of ending work in process		$ 1,77,800
Total costs assigned	$ 23,27,000+$ 1,77,800	$ 25,04,800

Thank you !!!!!!