Question

BWIP has 2,000 units which are 100% complete in materials and 60% complete in conversion. Units started this period were 15,000. EWIP has 5,000 units, 100% complete in materials and 50% complete in conversion. Cost of BWIP was $6,000 in materials and $2,400 in conversion. Cost added during the period was $45,000 in materials and $26,600 in conversion. What was the cost of the units transferred-out this period? (hint: complete step 4 from the 5 step production report) (1 Point) $75,000 $45,000 $60,000 O $80,000

Answer 1

To answer the questions first lets prepare the production cost report

Wanda Company Production Cost Report Equivalent Units Direct Materials Conversion Costs Units to account for: Beginning WIP Started in production Total Units to Account for Physical Units 2000 15000 17000 Units accounted For Completed and Transferred Ending WIP Total Units accounted for 120001 50001 17000 120001 5000 17000 12000 2500 14500 Direct Material Conversion Costs Total Costs Costs to account for Beginning Work In Process Costs Added During the month Total Costs to account for Divided by: Total Equivalent Units of production Cost per equivakent units 6000 450001 51000 17000 3.00 2400 26600 29000 14500 2.00 8400 71600 80000 5.00 Costs accounted for Completed and Transferred out Ending Work In Process Total Costs accounted for 360001 15000 51000 24000 5000 29000 60000 20000 80000

Answers:

1. What is the cost of units transferred out - (12000 units *$5) = $60000

2. What is the cost of ending WIP - (5000*3)+(2500*2) = $20000

3.Cost of Material per unit = $ 3.00 (see production cost report for calculation)

4. Units Transferred Out = 2000+15000-5000 = 12000 units

Hope this helps! In case of any clarifications, kindly use the comment box below