Question

Bachelet Inc. uses the weighted-average method in its process costing system. The following data concern the operations of the company's first processing department for a recent month. Work in process, beginning: Units in process Stage of completion with respect to materials Stage of completion with respect to conversion Costs in the beginning inventory: 400 90% 40% Materials cost Conversion Cost $756 $4,448 Units started into production during the month Units completed and transferred out 13,000 13,300 Costs added to production during the month: Materials cost Conversion cost $29,949 $362,127 Work in progress, ending: Units in process Stage of completion with respect to materials Stage of completion with respect to conversion 100 50% 30% Required: Using the weighted-average method: a. Determine the equivalent units of production for materials and conversion costs. b. Determine the cost per equivalent unit for materials and conversion costs. c. Determine the cost of units transferred out of the department during the month.

Answer 1

Calculate equivalent unit :

	Physical unit	%	EUP-material	%	EUP-conversion
Unit transferred out	13300	100%	13300	100%	13300
Ending work in process	100	50%	50	30%	30
Total	13400		13350		13330

Calculate cost per equivalent unit :

	Material	conversion cost
Beginning work in process	756	4448
Cost added during period	29949	362127
Total cost	30705	366575
Equivalent unit	13350	13330
Cost per equivalent unit	2.30	27.50

Cost of units transferred out = (2.30+27.50)*13300 = 396340