Question

Required information (The following information applies to the questions displayed below.) Victory Company uses weighted-average process costing to account for its production costs. Conversion cost is added evenly throughout the process. Direct materials are added at the beginning of the process. During November, the company transferred 715,000 units of product to finished goods. At the end of November, the work in process inventory consists of 205,000 units that are 80% complete with respect to conversion. Beginning inventory had $538,200 of direct materials and $87,900 of conversion cost. The direct material cost added in November is $3,601,800, and the conversion cost added is $1,670,100. Beginning work in process consisted of 79,000 units that were 100% complete with respect to direct materials and 80% complete with respect to conversion, of the units completed, 79,000 were from beginning work in process and 636,000 units were started and completed during the period. Required: 1. Determine the equivalent units of production with respect to direct materials and conversion, Equivalent Units of Production (EUP)-Weighted Average Method Units % Materials EUP-Materials % Conversion EUP-Conversion Total units

Answer 1

1) Equivalent unit Particulars Unit transferred out Ending work in process Equivalent unit EUP-Material EUP-Conversion 715000 715000 205000 164000 920000 879000 2) Cost per equivalent unit Particulars Beginning WIP Cost added Total Cost Equivalent unit cost per equivalent unit material Conversion $ 5,38,200.00 $ 87,900.00 $ 36,01,800.00 $ 16,70,100.00 $ 41,40,000.00 $ 17,58,000.00 920000 879000 $ 4.50 $ 2.00 EUP 3) Cost assigned Cost of Units Transferred Direct Material Conversion Total cost of units tranferred out Cost Per Unit 715000 $ 715000 $ 4.50 2.00 Total Cost $ 32,17,500.00 $ 14,30,000.00 $ 46,47,500.00 cost of ending work in proess Direct Material Conversion Total cost of ending work in proess Total Cost Accounted for 205000 $ 164000 $ 4.50 2.00 $ $ 9,22,500.00 3,28,000.00 $ 12,50,500.00 $ 58,98,000.00 * Kindly Comment down for any clarifications/ queries and please upvote.