Question

The Richmond Corporation uses the weighted-average method in its process costing system. The company has only a single processing department. The company's ending work in process inventory on August 31 consisted of 18,400 units. The units in the ending work in process inventory were 100% complete with respect to materials and 60% complete with respect to labor and overhead. If the cost per equivalent unit for August was $2.85 for materials and $4.35 for labor and overhead, the total cost assigned to the ending work in process inventory was: Multiple Choice $132,480 $79,488 $84,456 $100,464

Answer 1

Ending work-in-progress units = 18,400 units

The units were 100% complete with respect to materials, with cost per equivalent unit for materials = $2.85.

So, materials cost assigned to ending WIP units = $2.85 * 18,400 units = $52,440

Further, the ending WIP units were 60% complete with respect to labour and overhead. So, complete ending WIP units = 18,400 * 60% = 11,040 units

Cost per equivalent unit for labour and overhead = $4.35

So, labour and overhead cost assigned to ending WIP = $4.35*11,040 units = $48,024

Total cost assigned to ending work-in-progress inventory = materials cost assigned + labour and overhead cost assigned

= $52,440 + $48,024

= $100,464

Therefore, correct answer is $100,464