Question

Superior Micro Products uses the weighted-average method in its process costing system. During January, the Delta Assembly Department completed its processing of 25,900 units and transferred them to the next department. The cost of beginning work in process inventory and the costs added during January amounted to $690,754 in total. The ending work in process inventory in January consisted of 2,300 units, which were 80% complete with respect to materials and 60% complete with respect to labor and overhead. The costs per equivalent unit for the month were as follows: Materials Labor Overhead Cost per $1 3.10 $ 4.60 $7.4 0 equivalent unit es Required: 1. Compute the equivalent units of materials, labor, and overhead in the ending work in process inventory for the month. 2. Compute the cost of ending work in process inventory for materials, labor, overhead, and in total for January 3. Compute the cost of the units transferred to the next department for materials, labor, overhead, and in total for January.

Answer 1

1) computation of equivalent units of material, labir and overhead :

		equivalent units
particular	units	material	labor	overhead
		units	% of completions	units	% of completions	units	% of completions
units completed and transferred	25900	25900	100	25900	100	25900	100
ending wip	2300	1840	80	1380	60	1380	60
total	28200	27740		27280		27280

2) computation of cost of ending wip of material, labor and overhead :

particular	equivalent units	cost per equivalent unit	total cost
ending wip :
material	1840	$13.10	$24104
labor	1380	$4.60	$6348
overhead	1380	$7.40	$10212
total			$40664

3) computation of cost of units transferred to next department for material, labor, overhead and in total for january :

particular	equivalent units	cost per equivalent unit	total cost
ending wip :
material	25900	$13.10	$339290
labor	25900	$4.60	$119140
overhead	25900	$7.40	$191660
total			$650090

4) preparation of cost reconciliation for january :

cost reconciliation
total cost to be accounted for :
cost accounted as follows :-
cost of units completed and transferred out :
material	25900 x $13.10 = $339290
labor	25900 x $4.60 = $119140
overhead	25900 x $7.40 = $191660
total cost of units completed and transferred		$650090
cost of ending wip :
material	1840 x $13.10 = $24104
labor	1380 x $4.60 = $6348
overhead	1380 x $7.40 = $10212
total cost of ending wip		$40664
total cost accounted for		$690754

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