Question

Required Information The following information applies to the questions displayed below.) Victory Company uses weighted average process costing to account for its production costs. Conversion cost is added evenly throughout the process. Direct materials are added at the beginning of the first process. During November, the first process transferred 730,000 units of product to the second process. Additional information for the first process follows. At the end of November, work in process inventory consists of 183.000 units that are 50% complete with respect to conversion. Beginning work in process inventory had $593,450 of direct materials and $164,300 of conversion cost. The direct material cost added in November is $3.971.550, and the conversion cost added is $3,121,700. Beginning work in process consisted of 65.000 units that were 100% complete with respect to direct materials and 80% complete with respect to conversion. Of the units completed, 65,000 were from beginning work in process and 665,000 units were started and completed during the period. Required: For the first process: 1. Determine the equivalent units of production with respect to direct materials and conversion. Equivalent Units of Production (EUP)-Weighted Average Method Units % Materials EUP-Materials % Conversion EUP-Conversion Total units

Answer 1

Answer

• Requirement 1

EUP - Weighted Average Method	Units	% Material	EUP Materials	% Conversion	EUP - Conversion
Units TRANSFERRED	730,000	100%	730,000	100%	730,000
Units of ENDING WIP	183,000	100%	183,000	50%	91,500
Equivalent Units of Production			913,000		821,500

• [2]

COST per EUP			Material		Conversion
Cost of Beginning WIP			$        593,450.00		$                                164,300.00
Cost incurred during the period			$    3,971,550.00		$                            3,121,700.00
Total Costs		Costs	$    4,565,000.00	Costs	$                            3,286,000.00
Equivalent units of production		EUP	913,000	EUP	821,500
Cost per EUP			$              5.00000		$                                      4.00000

• [3]

Cost of Units Transferred Out	EUP	Cost per EUP	Total Cost
- Direct Materials	730,000	$                      5.00	$    3,650,000.00
- Conversion	730,000	$                      4.00	$    2,920,000.00
Total Cost transferred Out				$        6,570,000.00
Cost of ending WIP	EUP	Cost per EUP	Total Cost
- Direct Materials	183,000	$                      5.00	$        915,000.00
- Conversion	91,500	$                      4.00	$        366,000.00
Total cost of ending WIP				$        1,281,000.00
Total costs accounted for					$                            7,851,000.00