Question

The ledger of American Company has the following work in process account. Work in Process-Painting 5/1 Balance 3,690 5/31 Transferred out? 5/31 Materials 5,740 5/31 Labor 2,682 5/31 Overhead 2,480 5/31 Balance Production records show that there were 400 units in the beginning inventory, 30% complete, 1.700 units started, and 1.500 u transferred out. The beginning work in process had materials cost of $2,240 and conversion costs of $1.450. The units in ending Inventory were 40% complete, Materials are entered at the beginning of the painting process. How many units are in process at May 31? Work in process, May 31 units e Textbook and Media Question Part Score -0.5 1 13 MacBook Pro 80 900 DOO F4 1 # A $ 4 % 5 3 6 & 7 8 9 E R T Y U

Answer 1

1. Ending Work in process = Begining balance of WIP+units started - units transfered out ie = 400+1700-1500 => 600 units

2. Unit material cost = Cost of materials/equivalent units ie (2240+5740)/(1500+600) = $ 3.8 /unit

3. Unit conversion cost = Cost of conversion/equivalent cost ie, (1450+2682+2480)/(1500+600*40%)=> $ 3.8 /unit

Note: Cost of materials = Cost of Begining Inventory+ cost of materials during the period

Cost of conversion = Cost at beginning + cost of labor + cost of overhead

Equivalent units = units transfered out + proportionate ending inventory.

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