Question

Kurtulus Corporation uses the weighed-average method in its process costing system. Data concerning the first processing department for the most recent month are listed below:

Beginning work in process inventory: Units in beginning work in process inventory 600 Materials costs $ 7,000 Conversion costs $ 2,300 Percent complete with respect to materials 55 % Percent complete with respect to conversion 25 Units started into production during the month 6,500 Units transferred to the next department during the month 5.700 Materials costs added during the month $ 110.100 Conversion costs added during the month $ 83,200 Ending work in process inventory: Units in ending work in process inventory 1.400 Percent complete with respect to materials 70 Percent complete with respect to conversion

The total cost transferred from the first processing department to the next processing department during the month is closest to:
a. $202,624
b. $193,298
c. $175,246
d. $218,290

Answer 1

Answer

• Cost transferred = $ 175,246 Option ‘C’ is CORRECT
• Working

Cost of Units Transferred Out	EUP	Cost per EUP	Total Cost
- Direct Materials	5,700	$                    17.53	$          99,921.00
- Conversion	5,700	$                    13.21	$          75,297.00
Total Cost transferred Out				$            175,218.00 [Closest to $ 175,246]

EUP - Weighted Average Method	Units	% Material	EUP Materials	% Conversion	EUP - Conversion
Units TRANSFERRED	5,700	100%	5,700	100%	5,700
Units of ENDING WIP	1,400	70%	980	55%	770
Equivalent Units of Production			6,680		6,470
COST per EUP			Material		Conversion
Cost of Beginning WIP			$             7,000.00		$                                    2,300.00
Cost incurred during the period			$        110,100.00		$                                  83,200.00
Total Costs		Costs	$        117,100.00	Costs	$                                  85,500.00
Equivalent units of production		EUP	6,680	EUP	6,470
Cost per EUP			$            17.52994		$                                   13.21484