Question

Required information (The following information applies to the questions displayed below.) Tamar Co. manufactures a single product in two departments. All direct materials are added at the beginning of the Forming process. Conversion costs are added evenly throughout the process. During May, the Forming department started 29,250 units and transferred 30,700 units of product to the Assembly department. Its 4,700 units of beginning work in process consisted of $21,500 of direct materials and $298.440 of conversion costs. It has 3,250 units (100% complete with respect to direct materials and 80% complete with respect to conversion) in process at month-end. During the month, $521700 of direct materials costs and $3,031,560 of conversion costs were charged to the Forming department 1. Prepare the Forming department's process cost summary for May using the weighted average method. Total costs to account for: 0 Total costs to account for Total costs accounted for Difference due to rounding cost/unit Unit reconciliation: Units to account for: Total units to account for Total units accounted for: Total units accounted for

Answer 1

1) Under weighted average method, equivalent units are to be calculated only for units completed & transferred out and units lying as ending work in process as it is assumed that the unit price entered into the process become integral part of total units and no segregation between units transferred from beginning work in process and introduced during current process. Conversion cost includes Labor Overheads. So,

1 Groter w.zigtet Total cost to account for Cost of beginning wipe 319940(21500 +238440 Cost incurred this period 3553260 (52136 1303560) Total costs to account for 3873200 Total cost accounted for 3873200 35612007312000 Difference due to rounding conh/unit o Unit reconcillation! Units to account for Begining wil in units 4700 Units started this period 29250 Total units to account for 33 350 Units accounted for Units completed & transterred out 30700 Ending WIP in unib 3250 Total units accounted for 33.950

whole EUP Units materials, Correasin 3250 100%. 33300 33950 EUP .. EUP weighted Avg. Methoel Material conversion Matcrius Completed a transtend 30700 | 100% 130700 100". 30700 Endind WIP 3250 80% 2600 EUP 133950 Cost per equivalent writ of production, Material Conversion Cost of begining coll 21500 Cost Added during 3031560 Total Material Cast & Conversion costs 543200 Divided by equivalent units of production 33950 16 1. Cost per equivalent units of production 100 298480 the period 521700 333000 333 00

EUP Totals Cost per Eup 16 ( 100 30700 3otoo 491200 3070 000 13561200 7 Total cost accounted for Cost of whits transtored out Materials Convension Total Cast Transferred Out Cost of ending Materials Converion Total Costs And An of wil Total Costs Accounted for WIP Р Eup 3250 2600 Cost/ supl Totels 52000 loo 26ooo 312000 3873200 [3501200 +312000

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