Question

Sunspot Beverages, Ltd., of Fiji uses the weighted-average method in its process costing system. It makes blended tropical fruit drinks in two stages. Fruit juices are extracted from fresh fruits and then blended in the Blending Department. The blended juices are then bottled and packed for shipping in the Bottling Department. The following information pertains to the operations of the Blending Department for June. Percent Completed Materials Conversion 700 400 Work in process, beginning Started into production Completed and transferred out Work in process, ending Units 70,000 460,000 450,000 80,000 750 25% Work in process, beginning Cost added during June Materiale Conversion $36,550 $ 13,500 $ 391,850 $287,300 Required: 1. Calculate the Blending Department's equivalent units of production for materials and conversion in June. 2. Calculate the Blending Department's cost per equivalent unit for materials and conversion in June. 3. Calculate the Blending Department's cost of ending work in process inventory for materials, conversion, and in total for June. 4. Calculate the Blending Department's cost of units transferred out to the Bottling Department for materials, conversion, and in total for June 5. Prepare a cost reconciliation report for the Blending Department for June.

Answer 1

Answers

• [1]

	Material	Conversion
Equivalent units of production	510,000	470,000

EUP - Weighted Average Method	Units	% Material	EUP Materials	% Conversion	EUP - Conversion
Units TRANSFERRED	450,000	100%	450,000	100%	450,000
Units of ENDING WIP	80,000	75%	60,000	25%	20,000
Equivalent Units of Production			510,000		470,000

• [2]

	Material	Conversion
Cost per Equivalent units	$                         0.84	$                              0.64

COST per EUP			Material		Conversion
Cost of Beginning WIP			$          36,550.00		$                                  13,500.00
Cost incurred during the period			$        391,850.00		$                                287,300.00
Total Costs		Costs	$        428,400.00	Costs	$                                300,800.00
Equivalent units of production		EUP	510,000	EUP	470,000
Cost per EUP			$              0.84000		$                                      0.64000

• [3]

	Material	Conversion	Total
Cost of ending WIP Inventory	$               50,400.00	$                    12,800.00	$                       63,200.00

Cost of ending WIP	EUP	Cost per EUP	Total Cost
- Direct Materials	60,000	$                      0.84	$          50,400.00
- Conversion	20,000	$                      0.64	$          12,800.00
Total cost of ending WIP				$              63,200.00

• [4]

	Material	Conversion	Total
Cost of units completed & transferred out	$            378,000.00	$                 288,000.00	$                     666,000.00

Cost of Units Transferred Out	EUP	Cost per EUP	Total Cost
- Direct Materials	450,000	$                      0.84	$        378,000.00
- Conversion	450,000	$                      0.64	$        288,000.00
Total Cost transferred Out				$            666,000.00

• [5]

Costs to be accounted for:
Cost of Beginning WIP Inventory	$           50,050.00
Cost added to production during the period	$         679,150.00
Total Cost to be accounted for	$         729,200.00
Costs accounted for as follows:
Cost of units transferred out	$         666,000.00
Cost of Ending WIP Inventory	$           63,200.00
Total Cost accounted for	$         729,200.00