Question

I know the answers I just need detailed step-by-step instructions.

Gerard Corporation adds raw materials to production at the beginning of the process in the Assembly Department. Materials data for this department for March 2011 are as follows:

	Costs
	Units	Materials	Conversion
Work in process, March 1	25,000	$ 68,750	$167,650
Started during March	100,000	300,000	903,350
Work in process, March 31	10,000

Beginning inventory was 70 percent complete. Ending inventory was 40 percent complete.

              11a. Refer to the information above. How many equivalent units for materials would there be for Gerard Corporation in March using the FIFO method? (Ans: 100,000)

              11b. Refer to the information above. How many equivalent units for conversion costs would there be for Gerard Corporation in March using the FIFO method? (Ans: 101,500)

11c. Refer to the information above. What is the cost of goods completed and transferred out for Gerard Corp using the Weighted Average method? (Ans: $1,374,250)

11d. Try to prepare complete cost of production reports based on the FIFO and Weighted Average methods using the above information. Note that you should get the answers to questions 11 through 13 if you do the complete cost of production reports.

Answer 1

1.

FIFO method
Beggining units	25000	Transferred out	1,15,000
Started into production	100000	Ending units	10,000
	125000		125000
Equivalent units	Material	Conversion
Beginning units	25000	25000
Completion in current period	0%	30%
A	0	7500
Units started and completed	90000	90000
Completion	100%	100%
B	90000	90000
Ending Units	10,000	10,000
Completion	100%	40%
C	10000	4000
Total units A+B+C	100000	101500
Cost per equivalent units
Per unit cost	Cost	Total units	Per unit cost
Material cost	300000	100000	3.00
Conversion cost	903350	101500	8.90
Total	1203350		11.90

Cost of goods sold	Material	convertion cost
Beginning inventory completed
Completion	0%	30%
Per unit cost	3.00	8.90
Units	25000	25000
Total cost   A	0.00	66750	66750
Units started and completed
Completion	100%	100%
Per unit cost	3.00	8.90
Units	90000	90000
Total cost    B	270000	801000	1071000
Beginning work in progress C	68750	167650	236400
Total cost A+B+C			1374150
Ending work in progress
Completion	100%	40%
Per unit cost	3.00	8.90
Units	10,000	10,000
Total cost	30000	35600	65600

2.

Weighted average cost
Beggining units	25000	Transferred out	1,15,000
Started intro production	100000	Ending units	10,000
Units accounted for	125000		125000
Equivalent units	Material	Conversion cost
Units transferred                      A	115000	115000
Ending Units	10,000	10,000
Completion	100%	40%
B	10000	4000
Total units	125000	119000
Cost per equivalent units
Particulars	Material	Conversion cost	total
As at beginning	68750	167650	236400
Added during the month	300000	903350	1203350
Cost to be accounted for	368750	1071000	1439750
Total eqivalent units	125000	119000
Cost per equivalent unit	2.95	9.00	11.95
Cost per equivalent unit = Cost to be accounted for / Total equivalent units

	Cost of ending work in progress
			Conversion cost
	Particulars	Material		Total
	Ending units	10,000	10,000
	Cost per equivalent units	2.95	9.00
	Completion	100%	40%
	Total cost	29500	36000	65500
	Cost of goods transferred		Conversion cost
	Particulars	Material		Total
	Number of units	115000	115000
	Cost per equivalent units	2.95	9.00	11.95
	Total amount	339250	1035000	1374250