Weighted-average method. McKnight Handcraft is a manufacturer of picture frames for large retailers. Every picture frame passes through two departments: the assembly department and the finishing department. This problem focuses on the assembly department. The process-costing system at McKnight has a single direct-cost category (direct materials) and a single indirect-cost category (conversion costs). Direct materials are added when the assembly department process is 10% complete. Conversion costs are added evenly during the assembly department’s process. McKnight uses the weighted-average method of process costing. Consider the following data for the assembly department in April 2014:
1. Summarize the total assembly department costs for April 2014, and assign them to units completed (and transferred out) and to units in ending work in process.
2. What issues should a manager focus on when reviewing the equivalent units calculation?
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