Question

Superior Micro Products uses the weighted-average method in its process costing system. During January, the Delta Assembly Department completed its processing of 25,300 units and transferred them to the next department. The cost of beginning work in process inventory and the costs added during January amounted to $662,570 in total. The ending work in process inventory in January consisted of 2,500 units, which were 40% complete with respect to materials and 20% complete with respect to labor and overhead. The costs per equivalent unit for the month were as follows: Cost per equivalent unit Materials Labor Overhead $ 14.50 $ 3.30 $ 7.60 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.) Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Compute the equivalent units of materials, labor, and overhead in the ending work in process inventory for the month. Materials Labor Overhead Equivalent units (Required 1 Required 2 >

Answer 1

Requirement 1

Particulars	Units	% Materials	EUP Materials	% Labour	EUP Labour	% Overhead	EUP Overhead
Closing Inventory Work in Process	2,500	40%	1,000	20%	500	20%	500
Total Units			1,000		500		500

Notes

EUP stands for Equivalent Units of Production

EUP Materials = Units * % Materials

EUP Labour = Units * % Labour

EUP Overhead = Units * % Overhead

Question 2

Particulars	Material	Labour	Overhead
Equivalent Units in Work in Process Closing Inventory	1,000	500	500
Equivalent Cost per Unit	14.50	3.30	7.60
Cost of Ending Work in Process Inventory	14,500	1,650	3,800

Notes

Total Cost of Work in Process = 14,500 + 1,650 + 3,800 = $ 19,950

Cost of Ending Work in Process Inventory = Equivalent Cost per Unit * Closing Inventory of Work in Process Equivalent Units

Question 3

Particulars	Materials	Labour	Overhead
Units Transferred Out	25,300	25,300	25,300
Equivalent Cost per Unit	14.50	3.30	7.60
Equivalent Annual Cost of Units Transferred Out	366,850	83,490	192,280

NOTES

Total Cost of Units Transferred = 366,850 + 83,490 + 192,280 = $ 642,620

Cost of Equivalent Units Transferred Out = Units Completed and Transferred Out * Equivalent Cost per Unit

Equivalent Costs for Materials , Labour and Overhead are all considered 100% Completed so 25,300 is the equivalent units transferred for all three.

Question 4

Particulars	Amount
Total Cost to be accounted for	662,570
Costs Accounted as follows
Costs of Units Transferred Out	642,620
Cost of Ending Work in Process	19,950
Total Cost accounted for	662,570

Notes

Total Cost Accounted for = Cost of Units Transferred + Cost of Ending Work in Process