Question

The Richmond Corporation uses the weighted-average method in its process costing system. The company has only a single processing department. The company's ending work in process inventory on August 31 consisted of 18,800 units. The units in the ending work in process inventory were 100% complete with respect to materials and 60% complete with respect to labor and overhead. If the cost per equivalent unit for August was $2.95 for materials and $4.45 for labor and overhead, the total cost assigned to the ending work in process inventory was: Multiple Choice $83,472 $105,656 $88,924 $139,120

Answer 1

Solution:

Cost assigned to the ending work in process inventory = (Equivalent units for Material *Cost per equivalent unit for Materials) + (Equivalent units for Conversion *Cost per equivalent unit for Conversion)

= 18,800*$2.95 + 18,800*60%*$4.45

= $55460 + $50196

= $105,656

Hence second option is correct.