Question

Superior Micro Products uses the weighted-average method in its process costing system. During January, the Delta Assembly Department completed its processing of 26,800 units and transferred them to the next department. The cost of beginning work in process inventory and the costs added during January amounted to $727,496 in total. The ending work in process inventory in January consisted of 3,600 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 equivalent unit $ 12.90 $5.00 $6.90 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 4. Prepare a cost reconciliation for January. (Note: You will not be able to break the cost to be accounted for into the cost of beginning work in process inventory and costs added during the month.)

Answer 1

1) Equivalent unit

	Material	Labor	Overhead
Ending WIP	3600*80% = 2880	3600*60% = 2160	2160

2) Cost of ending WIP

	Material	Labor	Overhead	Total
Cost of ending WIP	2880*12.90 = 37152	2160*5 = 10800	2160*6.9 = 14904	62856

3) Cost of unit transferred out

	Material	Labor	Overhead	Total
Cost of Unit transferred out	345720	134000	184920	664640

4) Cost reconciliation

Total Cost to be accounted for	727496
Cost accounted for
Cost of unit transferred out	664640
Cost of ending WIP	62856
Total cost accounted for	727496