Question

The Plastic Flowerpots Company has two manufacturing departments, molding and packaging. At the beginning of the month, the molding department has 3,900 units in inventory, 70% complete as to materials. During the month, the molding department started 27,500 units. At the end of the month, the molding department had 5,850 units in ending inventory, 80% complete as to materials. Units completed in the molding department are transferred into the packaging department.
Cost information for the molding department for the month follows:

Beginning work in process inventory (direct materials)	$	3,100
Direct materials added during the month		46,900

- Weighted average: Computing equivalent units and cost per EUP (direct materials)

1. Using the weighted-average method, compute the molding department’s (a) equivalent units of production for materials and (b) cost per equivalent unit of production for materials for the month. (Round "cost per equivalent unit of production" to 2 decimal places.)

AND

2. Using the weighted-average method, assign direct materials costs to the molding department’s output—specifically, the units transferred out to the packaging department and the units that remain in process in the molding department at month-end. (Do not round intermediate calculations.)

Answer 1

1(a).

	Physical Units	Equivalent Units
		Direct Materials
Beginning work-in-process	3900
Started in production	27500
Total	31400
Completed and transferred out	25550	100%	25550
Ending work-in-process	5850	80%	4680
Total	31400		30230

(b)

	Direct Materials
Cost of beginning work in process	3100
Direct materials added during the month	46900
Total cost $	50000
÷ Equivalent units of production	30230
Cost per equivalent unit of production $	1.65

2. Direct materials cost assigned to:

Units transferred out to the Packaging department = 25550 x $50000/30230 = $42259

Units in process in Molding department at month end = 4680 x $50000/30230 = $7741

Note: Final answers are rounded off to the nearest whole dollar amount.