Victory Company uses weighted-average process costing to account for its product

Question

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 process. During November, the company transferred 770,000 units of product to finished goods. At the end of November, the work in process inventory consists of 184,000 units that are 40% complete with respect to conversion. Beginning inventory had $496,080 of direct materials and $210,900 of conversion cost. The direct material cost added in November is $3,319,920, and the conversion cost added is $4,007,100. Beginning work in process consisted of 66,000 units that were 100% complete with respect to direct materials and 80% complete with respect to conversion. Of the units completed, 66,000 were from beginning work in process and 704,000 units were started and completed during the period.

Explanation / Answer

Material =beginning+added= 496080+3319920=$3,816,010

conversion=210900+4007100=$4,218,000

units of each :

Material= 770000+184000=954,000

conversion=(770000)+(.4*184000)=843,600

Equivalent cost per unit of material=$3,816,010/954,000=4

Equivalent cost per unit of conversion=$4,218,000/843,600=5

Related Questions

Navigate

• Browse (All)
• Browse V
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.