Required information [The following information applies to the questions display

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Required information [The following information applies to the questions displayed below.) The Fields Company has two manufacturing departments, forming and painting. The company uses the weighted-average method of process costing. At the beginning of the month, the forming department has 30,000 units in inventory, 80% complete as to materials and 20% complete as to conversion costs. The beginning inventory cost of $69,100 consisted of $50,200 of direct materials costs and $18,900 of conversion costs. During the month, the forming department started 390,000 units. At the end of the month, the forming department had 40,000 units in ending inventory, 80% complete as to materials and 30% complete as to conversion. Units completed in the forming department are transferred to the painting department. Cost information for the forming department is as follows: Beginning work in process inventory Direct materials added during the month Conversion added during the month 69,1ee 1,507,160 1,031,668 Calculate the equivalent units of production for the forming department 412,000 392,000 Prev 1 of4 Next> .html

Explanation / Answer

1) Equivalent unit :

Unit transferred out = 30000+390000-40000 = 380000

Equivalent unit of material = 380000+(40000*80%) = 412000

Equivalent unit of conversion = 380000+(40000*30%) = 392000

2) Cost per equivalent unit

Material = (50200+1507160)/412000 = 3.78 per equivalent unit

Conversion cost = (18900+1031660)/392000 = 2.68 per equivalent unit

3) Cost assignment and reconciliation:

Cost of units transferred out EUP Cost per EUP Total cost Direct material 380000 3.78 1436400 Conversion 380000 2.68 1018400 Total cost transferred out 2454800 Cost of ending work in process EUP Cost per EUP Total cost Direct material 32000 3.78 120960 Conversion 12000 2.68 32160 Total cost of ending work in process 153120 Total cost assigned 2607920

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