Question

6. Sumter Corporation uses the weighted-average method in its process costing system. The following data pertain to operations in the first processing department for a recent month: CA Work in process, beginning: Units in process 6,000 Percent complete with respect to materials 60 % Percent complete with respect to conversion 20% Costs in the beginning inventory: I Materials cost $ 78,200 Conversion cost $ 3,600 Units started during the month ? Units completed and transferred out during the month 70,000 Costs added to production during the month: Materials cost $ 286,600 Conversion cost $ 216,000 Work in process, ending: Units in process 8,000 Percent complete with respect to materials 75% Percent complete with respect to conversion 25% How much cost, in total, was assigned to the units transferred out to the next department during the month? A) $549,500 B) S584,400 C) $502,600 D) $535,000

Answer 1

Total cost assigned to the units transferred out to the next process department during the month is option B).$584400

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SUMTER CORPORATION Statement of Equivalent Production Input Output Equivalent production Conversion Item Units Item Units Material % Cost % Work on Opening WIP 6000 Opening WIP 6000 2400 40 4800 20 completed Additional and Units transferred to Introduced 72000 next process 64000 64000 100 64000 100 Normal loss Closing WIP 8000 6000 75 2000 25 Total 78000 78000 724001 70800 Statement of Cost for each Elements Equivalent Cost Elements of production per Costs Total Cost units unit Materials $78,200 Add: Additional Introduced $286,600 Total A $364,800 72400 $5.04 Conversion Cost $3,600 Add:Additional Introduced 216000 Total B $219,600 70800 $3.10 Total (A+B) $584,400 $8.14 Calculation of Units started during the month: Units completed and Transferred 70000 Add:Units at the end 8000 Loss:Units at the beginning -6000 Units started 72000