Question

During April, the production department of a process manufacturing system completed a number of units of a product and transferred them to finished goods. Of these transferred units, 60,000 were in process in the production department at the beginning of April and 240,000 were started and completed in April, Apni's beginning inventory units were 60% complete with respect to materials and 40% complete with respect to conversion. At the end of April, 82,000 additional units were in process in the production department and were 80% complete with respect to materials and 30% complete with respect to conversion 1. Compute the number of units transferred to finished goods Units transferred out 2. Compute the number of equivalent units with respect to both materials used and conversion used in the production department for April using the weighted average method Equivalent Units of Production - Weighted Average Units % Materials EUP-Materials % Conversion EUP- Conversion Equivalent units of production

Answer 1

1 Weighted Average Method-Equivalent production Unit Reconcilation Beginning Work in Process Inventory, Started this period Total units transferred to finished goods 60,000 240,000 300,000 a. Completed and Transferred out Ending WIP Equivalent units of production Equivalent units of production- Weighted Average Units % of Material EUP-Material 300,000 100% 300,000 82,000 80% 65,600 382,000 365,600 %Conversion 100% 30% EUP -Conversion 300,000 24,600 324,600

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*Completed and Transferred out: always 100 % in the current period;

*Ending WIP= given % in the current period.

*Weighted-Average Method:
*It calculates the equiavlent-unit cost of the work done to date and assigns this cost to equiavlent units
completed and transferred out of the process and to equivalent units in ending WIP inventory.
*The weighted-average cost is the total of all costs entering WIP account divided by total equivalent units
of work done to date.
*Equivalent units in Beginning WIP + Equivalent units of work done in current period = Equivalent units completed and transferred out in current period + Equivalent units in Ending WIP.
*Cost per Equivalent unit of production = Cost of beginning WIP + Started = Total Costs divided by Equivalent units.

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